http://www.veracast.com/webcasts/bio/ceoinvestor2015/09110256932.cfm

The next presenting company will be Resverlogix, and presenting for Resverlogix will be Don McCaffrey, President and CEO.

Hello. It’s a pleasure to be here today. Thank you for attending. We’re a Canadian company, but the weather is not our fault. We didn’t bring it with us.

So today, I’d like to go over some of the agenda that Resverlogix is moving forward with: The unmet needs in cardiovascular disease; we’ll introduce some of the details on RVX-208, which has also been named Apabetalone; and we’ll go through the epigenetic mechanism of action; clinical data presentation; some of our Phase III Clinical Trial planning; and the potential market inclusions; as well as additional clinical plan opportunities.

So what we’re addressing here is the problem of a 70% unmet need in cardiovascular management. Over the last several years, there has been great movement forward in cardiovascular care, with statins and other medications, but you still only have 30% of the market covered. Some of the new medications coming along, mostly LDL modulators like PCSK9, they’ll take a little bit more of a chunk of the market and cover it, but the biggest opportunity is the huge unmet needs, the 70% unmanaged cardiovascular issues.

And all data that we’re going to talk about here today that we’re presenting from Resverlogix is actually data that is above and beyond the premium management care. So we’re talking about patients who are already on statins on the best standard of care there is. So we’re pretty excited about the data that we’ve received.

Now the 70% unmet needs goes beyond just cardiovascular, it trends into other areas such as diabetes, you can see from this chart that there are 382 million patients worldwide with diabetes. It’s an enormous market Most of that is addressed by glucose types of drugs. And we’re looking at it from a different approach. Eighty percent of patients with diabetes die from cardiovascular disease. No matter how well you maintain the glucose, they die at the same rate. So we’re in this to look at it from a MACE point of view. Reducing major adverse cardiac events, the number one killer of both men and women.

Now chronic kidney disease (CKD) is even just an extension of the diabetes. And again, it results in very high death rates, and that’s something that we look to solve. Some of the patients in our last trial, about 15% of them, had CKD so we got some very good data on that.

Now a major adverse cardiac event trial or a MACE trial, could confirm the health benefits of cardiovascular disease, diabetes and CKD. So this is something that we’re planning going forward with endpoints that will be MACE. And for our MACE endpoints we’ve determined:

• Death from myocardial infarction (MI),

• MI without death,

• Revascularization procedure,

• Hospitalization for cardiac reasons, and

• Ischemic Stroke.

So let’s go into talk about RVX-208 a little bit, to get an idea of where this drug comes from and how it’s working. The 208 is a BET bromodomain, so it’s an epigenetic drug. It is the most clinically advanced bromodomain drug in the world, so we’re pretty excited about that. It has seven year head start on any other drug in this category, and none of the others are in cardiovascular. It’s a first-in-class molecule, as I’ve said. The drug is an inhibitor of bromodomains; and we are a selective bromodomain (inhibitor). So we hit BRD4 – BD2.

Now RVX-208 has a multi-modal approach to accomplishing its goal. For the first several years of our development we were very focused on the top one, reverse cholesterol transport. It was our belief that that was the whole goal. Raising ApoA1 and HDL would accomplish the reduction in MACE. Now, it’s a very big part of the story, but it is not the only part of the story. We’ve found out through having the only bromodomain epigenetic blood bank in the world. We’ve done microarrays and pathway analysis and we now know that it is multi-modal. It’s involving metabolic with glucose reduction, weight loss, and calcification storage. It’s also involving vascular inflammation, with the IL-6, IL-17, V-cam and MCP1; eGFR improvement and thrombosis (slide mentions positive platelet activity). So it’s a very exciting approach, and this does explain why you see such a prominent MACE reduction, which we’ll go over in a short while.

Now RVX-208, or Apabetalone, has received clinical testing approval in many countries around the world. So this drug has already been in almost a thousand patients. So we have a very good safety profile. We’ve operated in twelve countries. And we’ll probably double that with the next trial.

So let’s go into the story around the mechanism. So it’s epigenetic. And you have different approaches in epigenetics. You have writers, erasers and readers. So the first two are probably more common in epigenetics over the last ten years, where people came out with the HATs and the trans-methylases and all of those approaches. So what you’re looking at here is chemical-to-chemical interactions for both of these, the writers and the erasers. And with the readers you have a protein-to-protein interaction. So we’re very excited about that because we also believe that will be responsible for lower toxicity.

Now it’s a complex story. There are lots of bromodomains in the human body. There are about 48 of them in total. But we are specific to the BRD-2, 3, 4 and T. And in this case, RVX-208 focuses on BRD4-BD2. And it was the first-ever, and still as far as we know the only selective bromodomain. That was written up by the Structural Genome Consortium and published. So we were very pleased to see that. That’s a group of Oxford and Harvard and a bunch of pharmaceutical companies.

So our mechanism has been validated as a very exciting target by some pretty big people. This particular one is James Watson, as in Watson and Crick, one of the co-discoverers of DNA. So about two years ago Dr. James Watson wrote his first solo paper since 1972. Of course he has written hundreds of papers since then, but a solo paper pretty much indicates his belief in this. And he has some very strong positive feelings about BRD-4 as a target. As a matter of fact, in his paper he states that he thinks it’s the most important break-through since they discovered DNA. That’s a petty bold statement. I can’t say that on my own, but he certainly has the credentials to say it, so I’ll gladly repeat it.

Now the clinical data presentation. We’ll go through some of that. This is data from our last clinical trial, which was the ASSURE trial. It was an intravascular ultrasound trial. And in this trial we were able to discover that our drug in combination with Rosuvastatin, or Crestor, worked exceptionally well. We more than doubled the endpoint in the Crestor patients. So a very rewarding feeling to be able to see this data and understand it and move forward. Then what we did was we took the plasma and blood samples from this particular trial and ran those micro-arrays and the pathway analysis and we came up with some even more exciting data as to how this drug was working.

This is the IVUS data showing a patient before and after. You can see here that it was an 8.45 mm build-up, and after treatment it was a 3.1. So this would be one of our key patients that we gained a lot of knowledge from. So it was a patient who had low HDL. It was a patient who was in combination with Rosuvastatin or Crestor. So it’s a very exciting result there.

Well this is the most important result, is MACE. And we had no idea that in a trial this small we would actually see MACE. Normally you don’t see MACE in a trial below 20,000 patients, because the separation of curves is so small that it takes a long time. So we went back and we looked at all of our trials. The last three trials all have MACE results. So we’re pretty excited about going forward, and clearly Phase III is all about mortality and morbidity. So for us to already know that we have MACE results, and not only MACE results but very solid MACE results, it’s a real plus. So what we did here is we grouped our last two trials, so we had a very large patient population of 498, and we showed a relative risk reduction of 55% overall. That’s an enormous relative risk reduction. But when we break it down even further into the diabetic patient population, it’s 77% relative risk reduction with a p value of .01. So we’re very pleased with that and it allows us to design a Phase III trial going forward that would include these patients. Being HDL low and diabetes.

So we also had, about 15% of those patients had chronic kidney disease, CKD. So we were able to go in those patients and analyze results as well. And as you see in this chart, we had an increase in eGFR, which is fantastic. So even with a small number of patients, 35, it was statistically significant. Now this allows us to include this as endpoints in future trials as well. So we’re assuming in future trials about 15% of the patients will also have CKD. So it will allow us to have some secondary endpoint coverage in the next trial.

So the Phase III clinical trial planning is coming along. We’ve got a lot of work to do there, but it’s moved along quite nicely. And we have some advantages here. So a year ago, I was here a year ago talking away, and we basically had one program to discuss with pharma. And it was an acute coronary, long term, Phase III program potential going forward. So a program like that costs about 600 million dollars. It’s a tough sale. Now we’re sitting here. We can talk diabetes, we can talk CKD, and we will be talking orphan indications as well. We’ll announce those later this year. But as you see here, the guidance that we already have, that we can go in under Diabetes and CVD safety. The existing FDA guidance allow you to register a diabetes drug if you can show glucose lowering by about .5-.6, which we already do that in six months. However more importantly, you see in the middle column here, they will also allow registration as long as it doesn’t increase MACE by more than 30%. Remember, MACE includes death and heart attacks. They’re allowing an increase up to 30%. The good news for us is we have a decrease of 77%. In the clinical trial, we’ll probably set our endpoint at the normal 20% reduction or 25% or somewhere in that range and we’re assuming that we will far exceed that number. So we’re pretty excited. That allows us to run a manageable Phase III trial, instead of a typical cardiovascular Phase III with probably two Phase IIIs with 20,000 patients in each, that’s how you get up to a 600 million dollar price tag, we can run it with much smaller, we’re assuming about 2,500. So time and cost savings.

Now the planning is very far along. We’ve hired a new CMO, which is a fantastic CMO. And he has eleven years of experience of doing clinical trials at Pfizer, and he ran many of the Viagra trials. So he’s a very experienced guy. And the main objective for this trial will be MACE. No more need for messing around with biomarkers. We’re already seeing what we want to see in a registerable drug, and that’s reduction in MACE. So, it’s designed very much for that. The patient population as I’ve stated will be Diabetes mellitus and HDL below forty. (slide also said post events). This drug was designed to raise HDL and ApoA1 as it does, and we’ve found it most effective in those patients. The treatment will be a 100 mg b.i.d. The drug will eventually be capable for QD delivery, once a day. However, at this point in time it’s a very expensive conversion, so I don’t think we’ll do that just yet. It will be randomized 1:1 vs. placebo, and the average length will be about 18 months. The reason for that is the first patient will start and will go through probably a full two years. But after the last patient has been dosed for twelve months we stop the trial, so the average should come out to about 18 months. The longest we’ve dosed so far is six months, and we’re already seeing 77% relative risk reduction in just six months. The location will be in Europe and in the United States and it will be at about eighty to a hundred sites. Here we’re looking at minimum patients of around 1,600. It will be an adaptable trial, so, with that we’ll have the ability to go up to 3,200 patients. So it will be an event-driven trial. Unfortunately, or well I guess fortunately for us but, most CEOs are trying to show that they don’t have events in their trials and we want to have events in our trial. We want them all to be in placebo, but this is an event driven trial, so once we get to a certain number of events, then we’ll know that we have the power to claim victory. And as I’ve stated it will be around 25-30% MACE reduction is what we’ll be looking for in relative risk. And MACE being death, ischemic stroke, non-fatal MI, hospitalization for worsening of angina, revascularization with evidence of progressive anatomy or symptoms and congestive heart failure of ischemic etymology.

Now, let’s talk a little bit about the potential market size. The Deutshe Bank did a study a few years ago during the height of some of the HDL trials with Torceptrapib, Dalceptrabib and Darapladib. All trials that have not gone very well, but this is their slide showing what they thought the market value of those particular drugs were. So thirteen billion for Torcetrapib, Dalceptrapib 8.2 and for Darapladib 9 billion dollars. So clearly, a drug addressing the problem, and the problem is the 70% unmet need, is worth a lot of money. Now as you can see, we’re only at 0.06, so about a sixty million dollar market cap, making us one heck of a good deal. We do believe that there’s a lot of upward movement for this stock, and it will happen fairly soon.

Now we’ve looked at the different markets and we really want to go after the very sick patient population first. So our internal analysis is showing a population grouping with diabetes and low HDL with underlying cardiovascular disease, that’s about 7.6 million patients. High risk vascular disease with Low HDL, there’s another 4.5 million patients. And chronic kidney disease 6.7 million patients. So all combined this market size is about 18.8 million patients. And there is no competitor in this area that can reduce MACE, especially in diabetic patients. There is no drug that has ever reduced MACE in diabetic patients, with the exception, we believe of RVX-208 in the last three consecutive trials.

So we have potential to expand this as well into other indications. The data that we’ve garnered from these microarrays and the pathway analysis has been very very impressive. And has given us all kinds of new indications we can utilize. And because we are already a Phase II drug, we can advance this program quite fast. Some of the chronic kidney disease potential, well of course in the next trial, which will be called BETONMACE, that particular trial will have CKD actually built right in it, because 15% of those patients by default will have CKD. So we’re going to get a lot more information on that over the net trial and then we have the potential to either do parallel or subsequent Phase III work in chronic kidney disease. Same with peripheral artery disease. We’re looking at what we can do moving forward there. There are a lot faster and easier trials to run in PAD than in some of the chronic cardiovascular. We are still in discussion with NIH regarding funding for the Alzheimer’s program. And it’s a tough one. In the last application we scored very well, but the funding is very low in that area, so only the top couple percent will get it. I don’t think it’s been announced yet, but we expect to be re-applying for that and we’ll know shortly. That trial is only sixty patients. However, it is an invasive trial where each patient receives two lumbar punctures. So if there are any volunteers out there. Each patient is done with a lumbar puncture at the beginning for the cerebrospinal fluid analysis to see what levels the ApoA1 is at, and then six months later after treatment to see if the ApoA1 increases that we see in the body actually go through to the cerebrospinal fluid. So the reason for the trial is because of the belief that Apo-A1 has a very profound impact in the brain in two areas. When it’s attached to beta amyloid 40, the beta amyloid is non-toxic. So as you get older and your Apo-A1 drops off, the inverse curve is the increase in Alzheimers. And the other benefit is the blood brain barrier. It’s an integral healthy part of the immune system for the blood brain barrier, ApoA1. So by increasing it, it’s believed we can reduce the number of bleeds or the severity of bleeds in the blood brain barrier. It’s the same thing as in sports injuries or war injuries where you have seepage. And you see seepage in CAT scans. You see seepage and they’ll count the severity and the number of bleeds, and that’s how they’re determining Alzheimer’s most of the time. Now Phase III, orphan indications. We’re pretty excited about the potential here, and we do believe we’ll launch something in 2015. Next quarter we’ll update the market on our timeline and where we’re going with that.

So orphan indications and regional licensing deals lead us to future opportunities as well. Of course orphan indications could get us to market a lot faster. And same as far as getting to revenue. Regional licensing deals are in discussion. And we’re focusing on a few areas that have extremely high needs in diabetes, and that would be China, the Middle East and Russia.

So as a summary, RVX-208 and Resverlogix is now well positioned to move forward on an affordable registration path. And due to the pending regulatory science and data review the timelines as I mentioned will be released next quarter. Clinical planning and execution are in full swing. Around summer of last year we raised another 32 million dollars in financing, so we’re in very good shape there. And we are in a lot of discussions in the business development, and licensing co-development and planning are all in progress. And we’re looking forward to moving this forward.

So thank you very much. I appreciate your time today.