Healios Kk · TSE:4593
Healios Kk — Q1 FY2016 Earnings Presentation
59 slides from Healios Kk's earnings presentation, May 11, 2016
Slide 1: FY2016 1Q Financial Results
“To be the change in an ever evolving world through enrichment of living” FY2016 1Q Financial Results May 11, 2016
Slide 2: Contents
Contents 1 Financial Highlights P2 2 Updates in FY2016 1Q P5 3 Company Overview P18 4 Details of iPSC Regenerative Medicine P24 5 Expansion to 3D Organ（Liver） P42 6 News Follow-Up P51 7 Appendix P53 1 Copyright © HEALIOS K.K. All rights reserved.
Slide 3: 1. Financial Highlights
1. Financial Highlights 2
Slide 4: Statement of income
Statement of income （Million yen） FY 2016 1Q FY 2015 1Q YoY change Reasons for increase/decrease Sales 19 20 +1 Operating income ▲232 ▲2,114 ▲1,882 Multistem License-in ▲1,809 Ordinary income ▲241 ▲2,128 ▲1,887 - Net income ▲241 ▲2,131 ▲1,890 - R&D 117 1,980 +1,863 Multistem License-in +1,809 Amorti
Slide 5: Balance sheet
Balance sheet （Million yen / %） March 31,2016 December 31,2015 Change Main reasons for increase/decrease Current assets 9,325 8,503 ▲822 Cash and deposit ▲848 (88.9%) (79.8%) Non-current 1,162 2,154 +992 Long-term deposit +1,000 assets (11.1%) (20.2%) Total assets 10,487 10,657 +170 (100.0%) (100.0%
Slide 6: 2. FY2016 1Q Updates
2. FY2016 1Q Updates Step 1 Highlights Step 2 License agreement with Athersys Step 3 Collaborative research agreement with Universal Cells (Subsequent event) 5
Slide 7: Highlights: FY2016 1Q Updates
Highlights：FY2016 1Q Updates License agreement reached with Athersys (US) Somatic stem cell MultiStem® January: Facilitating Pipeline in Ischemic Stroke using MultiStem® regenerative medicine February: Long-term (1 year) results of a phase 2 clinical trial in UK/US published Optimization for manufac
Slide 8: Pipeline
Pipeline Pre- Development Phase Phase Phase Apply- On the Filed Indication Market clinical Progress Status Code I Trial II Trial III Trial approve Market test Somatic stem Ischemic cell Planning to start Clinical Trial HLCM051 Stroke Japan Regenerative ASAP Medicine HLCR011 Wet AMD Japan Ongoing Pre
Slide 9: 2. FY2016 1Q Updates
2. FY2016 1Q Updates Step 1 Highlights Step 2 License agreement with Athersys Step 3 Collaborative research agreement with Universal Cells (Subsequent event) 8
Slide 10: Licensing Contract Concluded between Athersys and Healios
Licensing Contract Concluded between Athersys and Healios Healios and Athersys, Inc. (“Athersys”) entered into a license agreement over products for regenerative medicine marketed in Japan, making use of the stem cell product MultiStem® and related technology, whose patent right and patent licensing
Slide 11: Outline of Ischemic Stroke in Japan
Outline of Ischemic Stroke in Japan Ischemic stroke Ischemic stroke, which represents the most common form of stroke (70–75％ in Japan), is caused by a blockage of blood flow in the brain that cuts off the supply of oxygen and nutrients and results in tissue loss It is estimated that 37.9％ of bedridd
Slide 12: Annual number of new patients with ischemic stroke in Japan
Annual number of new patients with ischemic stroke in Japan Target population Japan Note Annual medical costs for Number of patients (year) 230,000 – 330,000 ischemic stroke estimated at 1070.7 billion yen（2009) Severe patients （atherothrombotic and cardiogenic cerebral 130,000 infection) patients w
Slide 13: Mechanism of treatment using MultiStem
Mechanism of treatment using MultiStem Exhibits its therapeutic efficacy by suppressing inflammation and immune reactions and stimulating the formation of neuroprotective substances Following intravenous administration after acute neurological injury, MultiStem distributes to spleen, downregulatin
Slide 14: MultiStem Product Profile
MultiStem Product Profile MultiStem: A Multimodel Biological Product （Source）Athersys Cell therapy product based on patented Consistent safety profile technology Promotes healing and tissue repair through Developing for “off-the-shelf” multiple mechanisms of action administration: no tissue
Slide 15: Long-term (1 year) Results of Phase 2 clinical trial in the U.S. and U.K.
Long-term (1 year) Results of Phase 2 clinical trial in the U.S. and U.K. Percentage of Patients with Excellent Outcome 30% 29.0% MultiStem(18h-36h :n=31) 23.1% MultiStem(18h-48h :n=65) 16.1% 15.4% 8.2% Placebo(18h-48h :n=61) 6.6% 90 days 365 days (Source) Prepared by Healios based on the data provi
Slide 16: Strategic Background of Introduction of MultiStem
Strategic Background of Introduction of the Stem Cell Product, MultiStem Development in the field of stroke Cerebral infarction therapy with a new mechanism can be proposed and high market needs can be expected. Deliver it promptly to Japanese patients as a regenerative therapy product. Technica
Slide 17: 2. FY2016 1Q Updates
2. FY2016 1Q Updates Step 1 Highlights Step 2 License agreement with Athersys Step 3 Collaborative research agreement with Universal Cells (Subsequent event) 16
Slide 18: Collaborative research agreement with Universal Cells, Inc
Collaborative research agreement with Universal Cells, Inc Healios entered a collaborative research and exclusive option agreement with Universal Cells, Inc. regarding application of their genome editing technology to process iPS cells. With this technology, expression of HLA (cell surface molecules
Slide 19: 3. Company Overview
3. Company Overview 18
Slide 20: Healios Overview
Healios Overview About Us Company Name HEALIOS K.K.（TSE: 4593） Representative Hardy TS Kagimoto,MD President and CEO World Trade Center Building 15F Head Office 2-4-1 Hamamatsucho Minato-ku, Tokyo Japan 105-6115 Paid in Capital 5380million yen(As of end of March, 2016) Research Institution Kobe and
Slide 21: Company Roots
Company Roots How it was founded Started business to establish treatments for age-related macular degeneration and determined to build up a pharmaceutical company which can provide treatments for intractable diseases. Founded Aqumen Biopharmaceuticals K.K. (later transferred business to Healios)
Slide 22: Our Experienced Team for Development
Our Experienced Team for Development Lineup to Develop in Japan, US, and Europe Ophthalmology Expert Expert in Age-related Macular Degeneration President and CEO Director Overseas Development Al Reaves, Ph.D Hardy TS Kagimoto, MD Responsible for innovative Succeeded in Developing BBG clinical pr
Slide 23: Company History and Social Trends
Company History and Social Trends Pioneer of iPSC regenerative medicine development Collaborative Patent licensing agreement research Retina Institute Japan entered with iPS Academia Japan Joint research on organ bud agreement entered established with Universal Cells started with Yokohama City (curr
Slide 24: Business Portfolio
Business Portfolio Ophthalmic Europe Surgical Adjuvant ] BBG250 US RPE BBG Overseas Overseas Japan BBG in RPE in 3D Organs MultiStem Japan Japan Compound Drug iPSC Somatic stem cellmedicie Field Regenerative medicine Peripheral business areas Ophthalmic Surgical Eye Age-related macular Kidney/Liver/
Slide 25: 4. Details of iPSC Regenerative Medicine
4. Details of iPSC Regenerative Medicine Treat diseases with iPS Cells About AMD and Profitability Strategy for Placing RPE Cell Medicine on the Market
Slide 26: Transition to iPSC Regenerative Medicine
Transition to iPSC Regenerative Medicine Technological development from low molecular drug to antibody drug, iPSC regenerative medicine, etc. (Technological development） Low molecular drug Antibody drug iPSC regenerative medicine (Time) 25 Copyright © HEALIOS K.K. All rights reserved.
Slide 27: Concept of iPSC Regenerative Medicine
Concept of iPSC Regenerative Medicine Make “Regular Cells” from iPS Cells nerve cell myocardial cell Cell Transplantation Induction Treatment iPS cells pancreatic cell hepatocyte cell 26 Copyright © HEALIOS K.K. All rights reserved.
Slide 28: Mechanism of iPS Regenerative Medicine
Mechanism of iPS Regenerative Medicine Replace damaged cells with regular cells Tissue (cells) Damaged iPSC Regenerative Medicine Replace Damaged Tissue (cells) by Aging, Disease or Target Cells made from iPS cells with regular cells Accident Replacement Patient Recovery of Organ Function 27 Copyrig
Slide 29: Success Rate of Organ Transplantation
Success Rate of Organ Transplantation High Possibility to Succeed with Development of Technological Innovation Survival Rate after Surgery (organ) 100% pancreas 96.0% 91.1% heart 90% 91.9% kidney 80% 80.6% liver lung 72.3% 70% 67.7% intestine 60% 1 2 3 4 5 (years after transplantation) (note) The tr
Slide 30: 4. Details of iPSC Regenerative Medicine
4. Details of iPSC Regenerative Medicine Step 1 Treat diseases with iPS Cells Step 2 About AMD and Profitability Step 3 Strategy for Placing RPE Cell Medicine on the Market 29
Slide 31: Explanation of AMD Pathological Condition
Explanation of AMD Pathological Condition AMD causes RPE Cells to degenerate, which will damage functions Regular Macular Part Developed Dry AMD Immunity Barrier Maintained → Visual Cell Degenerative Disease → Dry AMD Macula Wet AMD Retinal Pigment Destruction of Immunity Barrier → Invasion of Immun
Slide 32: Estimated Number of AMD Future Patients in Serious Cases in US
Estimated Number of AMD Future Patients in Serious Cases in US Expected to Increase over Medium to Long Term as Society Ages （Thousand patients） 6,000 5.44 million 5,000 total caucasian black hispanic others 4,521 4,000 3.66 million 3,115 3,000 2.07 million 1,850 2,000 1,000 446 178 240 132 247 228
Slide 33: Number of AMD Patients
Number of AMD Patients Number of both Wet and Dry patients (including mild cases) （Thousand patients） America Japan Others The Number of AMD Patients 10,000 9,230 13,000 The Number of AMD Patients in Serious Cases 2,000 690 2,600-3,220 Wet-Patients in 1,000-1,500 630 1,300-1,950 serious cases Dry-Pa
Slide 34: Market Scale of AMD
Market Scale of AMD Annual Sales of Medicinal Treatments of Wet AMD: 831.6 billion yen. No Medicine for Dry AMD. Medicin Condition e/Effect Year Total America Japan Others Anti- VEGF 2013 363.6 billion yen 38.0 billion yen 294.7 billion yen 696.3 billion yen Medicine/ Wet Restraint of New Blood 2014
Slide 35: Treatment Subjects for Wet AMD
Treatment Subjects for Wet AMD Patients recurring within 1 Year, which is the case of approx. 92% of Wet AMD Patients, are the candidates for treatment. Recurrence frequency after receiving anti-VEGF medication No Relapse in 12 months 8% Present Treatment Subjects: Approx. 92％ Relapse in 12 months 3
Slide 36: Changes in Vision
Changes in Vision Good vision can be maintained with early treatment RPE transplantation (single) Vision） RPE transplantation (Prediction) Continuous administration of anti-VEGF medication Anti-VEGF medication Administration Not administered discontinued * The purpose of this illustration is to prom
Slide 37: Guide to Medicine Price – Approach from Medical Expense of Existing Health Care
Guide to Medicine Price – Approach from Medical Expense of Existing Health Care Anti-VEGF Medicine mostly Continues From the Beginning of the Treatment to Death Annual Medical Expense Annual Recommended Annual Medical Expense Unit Price of Anti-VEGF Medication Protocol 170,000 yen 1,020,000 yen 6 Ti
Slide 38: 4. Details of iPSC Regenerative Medicine
4. Details of iPSC Regenerative Medicine Step 1 Treat diseases with iPS Cells Step 2 About AMD and Profitability Step 3 Strategy for Placing RPE Cell Medicine on the Market 37
Slide 39: Autologous and Allogeneic Transplantation
Autologous and Allogeneic Transplantation We Handle Cross-Regenerative Medical Treatment , with High Profit Margins iPSC Regenerative iPSC Regenerative Medicine Medicine （Autologous） (Allogeneic) Patient A Donor Cell Cell Extraction Extraction Mass Production High Profit Cultivation Cultivation Indu
Slide 40: Project System
Project System Arranged Domestic Value Chain by Cooperation with Sumitomo Dainippon Pharma Co., Ltd Development Production Marketing Sales Can Build Up Developing, Sales and Manufacturing in Japan Institution Medical (※) Healios SighRegen SighRegen Healios 6.8 billion yen by Collaborative Secured Pe
Slide 41: Historical Alleviation of Regulations
Historical Alleviation of Regulations Japanese Government Revises Regulations to Put Japan at the Forefront Process of the Development So Far Clinical Research Clinical Trial Approval Sales Confirm Effectiveness and Safety Development Process of Introducing Early Approval System After-sales Effectiv
Slide 42: Rapid Impact of Modified Regulations
Rapid Impact of Modified Regulations Approval of regenerative medicine products, September 2015 Product Name Temcell® HS Injection Heart Sheet Company JCR Pharmaceuticals Terumo Acute GVHD after hematopoietic Severe heart failure due to ischemic heart Indications stem cell transplantation disease Pr
Slide 43: 5. Expansion to 3D Organs (Liver)
5. Expansion to 3D Organs（Liver） 42
Slide 44: Further Expansion when Three-Dimensional Organs Become Possible
Strategy From Now On Further Expansion when Three-Dimensional Organs Become Possible Early Stages Germination Term Growth Phase Organ Eye Rebuild Organ including Skin Three-Dimension Cartilage iPS *Allogeneic Transplantation *Mass Cultivation Skin, Cartilage *Autologous Transplantation 1990 2000 201
Slide 45: Joint Research Agreement in Organ Regenerative Medicine with Yokohama City University
Joint Research Agreement in Organ Regenerative Medicine with Department of Regenerative Medicine, Yokohama City University Graduate School of Medicine Leading authority of organ regeneration Prominent researcher of human organ construction Department of Regenerative Medicine, Yokohama City Departmen
Slide 46: Technical synergistic effects with iPSC regenerative medicine area
Technical synergistic effects with iPSC regenerative medicine area Consideration as a candidate for the one of the 3 types of cells that are necessary to create liver organ bud iPS cell of a Human Vascular Consideration of endothelial cell Precursor cell MSC or MultiStem the availability of MultiSte
Slide 47: Formation process of 3D Organ
Formation process of 3D Organ （Source）Japan Science and Technology Agency Science News “Diverse Approaches in Regenerative Medicine from Cell to Tissue/Organ” (Distributed October 3, 2013) https://sciencechannel.jst.go.jp/M130001/detail/M130001005.html 46 Copyright © HEALIOS K.K. All rights reserved
Slide 48: Survival Rate of Liver Failure Model Mouse
Survival Rate of Liver Failure Model Mouse Survival rate improves significantly in transplantation experiments Treatment effects of liver organ bud Process in which organ formed from organ bud links transplantation using human iPS cells mouse ‘s vascular network autonomously 100 Liver organ bud tran
Slide 49: Metabolic Liver Disease in Newborns
Metabolic Liver Disease in Newborns Yokohama City University planning to start clinical study in 2019 Target Metabolic liver disease “urea cycle defect,” etc. Urea cycle defect Disease caused by congenital abnormality of enzyme functioning in metabolic pathway (urea cycle) which detoxifies ammonia i
Slide 50: Marketability (Newborns Metabolic Liver Disease)
Marketability (Newborns Metabolic Liver Disease) Estimated market size of metabolic liver disease in newborns Total US Japan Europe Number of patients Approx. 160 Approx. 30 Approx. 230 Approx. 420 (year) Treatment costs (Annual) Enzyme replacement 30 million yen – 50 million yen therapy Estimated a
Slide 51: Expansion of Marketability
Expansion of Marketability (Alternative Treatment for Replacing Liver transplantation) Prospecting R&D for alternative treatment for liver transplantation Liver transplantation Total US Japan Europe Number of patients undergoing Approx. 6,000 Approx. 400 Approx. 4,000 Approx. 10,000 treatment (Annua
Slide 52: 6. News Follow-Up
6. News Follow-Up 51
Slide 53: Summary of Main News Follow-Up
Summary of Main News Follow-Up Clinical Study Application/ Market Somatic License in Clinical study MultiStem preparation approval release stem cell （Ischemic regenerativ Stroke ） e medicine Business alliance Pre Clinical Study Clinical Study Marketing RPEs in Japan RIKEN：Clinical study Announcement
Slide 54: 7. Appendix
7. Appendix 53
Slide 55: Phase 2 clinical trial in the U.S. and U.K. [Safety]
Phase 2 clinical trial in the U.S. and U.K. [Safety] Summary of safety results for all patients Safety results observed for MultiStem-treated vs placebo-treated patients MultiStem Placebo Diff. Parameter, at day 90 (n=65) (n=61) Baseline NIHSS(>24 hours) 13.4 13.3 n/a Mortality 6.2% 14.8% 8.6% Lif
Slide 56: Phase 2 clinical trial in the U.S. and U.K. [Efficacy]
Phase 2 clinical trial in the U.S. and U.K. [Efficacy] Summary of efficacy results for the subset of patients It showed significantly favorable recovery compared to placebo at 90 days according to the second analysis of patients administered MultiStem within 36 h after onset MultiStem Placebo Diff
Slide 57: Long-term (1 year) Results of Phase 2 clinical trial in the U.S. and U.K.
Long-term (1 year) Results of Phase 2 clinical trial in the U.S. and U.K. Between-group Differences in Excellent Outcome at 90 and 365 Days 90days 365days Subjects MultiStem (n=65) within 48 hours of stroke 15.4% 23.1% Placebo (n=61) within 48 hours of stroke 6.6% 8.2% Between-group difference 8.8%
Slide 58: Important Note on Future Events, etc.
Important Note on Future Events, etc. Descriptions on future events, etc. in this document include Healios’ assumptions, prospects, etc. based on information which could be acquired at the time this document was presented. For this reason, actual performance, development progress, etc. may differ fr
Slide 59: Contact information
＜Contact information＞ Phone: +81-(0)3-5777-8308 Corporate Communication Group For the press: pr@healios.jp Personnel and Administration Department For the investors: ir@healios.jp HEALIOS K.K.