EUPRAXIA PHARMACEUTICALS INC.

Drug Plasma Levels and Release Profiles

Adepu, S.; Ramakrishna, S. Controlled Drug Delivery Systems: Current Status and Future Directions. Molecules 2021, 26, 5905. https://doi.org/10.3390/molecules26195905

Another key feature differentiating EP-104 from other extended-release IA corticosteroid formulations is that more than 90% by weight of EP-104 is the active FP component in the investigational drug product, compared to less than 20% in other polymer based extended-release products which use degradation.

FP, although approved by the FDA, Health Canada, EMA and other regulatory agencies, is not currently approved for use in any formulation for the treatment of symptoms in either EoE or OA. To our knowledge, EP-104GI and EP-104IAR are the only extended-release formulations of FP in development for these conditions. We believe that the EP-104 drug delivery technology platform has the potential to have a beneficial application for EoE, given the already-established efficacy of oral immediate release of FP in this indication. We believe the drug delivery technology platform also has the potential to be an effective treatment for OA based on the proven efficacy of other corticosteroids for this condition. The potential for an improved treatment of EoE and OA with our proprietary formulations of EP-104 is further supported by a continually expanding library of data supporting the value of extended-release steroids.

EP-104 consists of a vial of EP-104 powder and a separate vial of liquid (referred to as the “Vehicle”). Before injection, the Vehicle is mixed with the dry powder to suspend the EP-104 particles; this enables the EP-104 powder to be injected into the patient. In an ongoing stability study, the powder has proven stable for 48 months when stored at room temperature. Batches of EP-104 are currently manufactured at the projected initial batch scale required for launch.

EP-104GI for Eosinophilic Esophagitis

EP-104 is being developed for the treatment of EoE, a rare immune-mediated disease recognized by the U.S. National Organization for Rare Disorders (“NORD”). We believe adaptations to the original formulation of EP-104 will result in the creation of EP-104GI for this specific indication, including modifications to the carrier vehicle and dose.

EoE is characterized by inflammation and the accumulation of large numbers of eosinophils (a type of white blood cells) within the epithelial lining of the esophagus. In adults, EoE leads to dysphagia and food impaction. In children, it often presents with irritability, nausea and vomiting. Patients with EoE frequently develop esophageal strictures, a narrowing or tightening of the esophagus, accompanied by proliferations of fibrotic tissue.

Market Size

According to NORD criteria, EoE is categorized as a rare disease. US population-based studies have shown that the incidence is increasing by approximately 10 cases per 100,000 persons annually. As a result, the most accurate estimates of the incidence and prevalence of EoE are the most recently published studies. In 2021 Kamat et al., performed a retrospective analysis via the MarketScan claims database covering 19-21 million US patients to identify patients diagnosed with EoE according to ICD-9/10 codes from 2015 to 2018. The authors reported prevalence of 117 patients per 100,000 in 2018. Using a ~2.9% annual prevalence growth rate since the data was collected, we estimate that EoE has a U.S. prevalence of 451,000 patients in 2023.

Patients with EoE often experience debilitating impacts from both symptoms and interventions, leading to mental health issues and compounding the overall disease burden on the health care system and the individual. Approximately US$1 billion is spent annually in hospitalizations, endoscopic procedures and medications to treat EoE, and a significant unmet medical need exists for cost-effective and less burdensome long-term treatment options.

Current Treatments

Current EoE treatment guidelines aim to lower eosinophil counts and improve symptoms. Recommended treatment progresses from strict dietary protocols to pharmacological intervention (proton pump inhibitors, swallowed corticosteroids) to mechanical intervention (endoscopic dilation for established strictures). The American Gastroenterological Association and the Joint Task Force on Allergy-Immunology Practice recommend the use of topical corticosteroids (budesonide, swallowed fluticasone) over systemic steroids for long-term EoE management.

There are two approved treatments for EoE in the U.S.:

In addition, Jorveza is an effervescent orodispersible budesonide tablet developed by Dr. Falk available in the European Union and Canada. Currently there is no indication from the developer of Jorveza that the product will be developed for the US market.

Future Competitive Landscape

Several pharmaceuticals in development are lifecycle extensions of currently marketed products:

Other products in late-stage development include:

Clinical Studies

We commenced dosing patients in the second quarter of 2023 in an open label Phase 1b/2a clinical study (RESOLVE) using EP-104GI for treatment of EoE. The RESOLVE study will be conducted in up to 90 adult patients with a confirmed diagnosis and active EoE symptoms. Primary outcomes for safety, PK and efficacy are being collected at various points over a 12-week total period, with a subsequent follow up at six, nine and twelve months. Initiallow-dose cohorts showed improvements in patients’ perception in pain on swallowing, ease of swallowing and histological endpoints. There were few adverse events, with no reports of candidiasis and no significant impact on glucose metabolism or adrenal function. We anticipate ongoing data readouts from subsequent dose-escalation cohorts throughout 2025. The RESOLVE protocol is active at sites in Canada, the Netherlands, Australia and New Zealand.

It is our intention to modify the protocol in 2025 to include a randomized, placebo-controlled component of the trial to further assess the optimal dose(s).

Subsequent steps in the research program will be determined following analysis of results as well as interaction with key opinion leaders and regulatory authorities. Pre-IND feedback from the US FDA received on December 3, 2024 provided clarity on IND-enabling early program requirements. We agreed on the design of an IND-enabling non-clinical study and have initiated this study. To seek marketing approval for EP-104GI, we expect to carry out at least one Phase 3 study assessing both efficacy (reduced histological signs and improved symptoms) and safety of EP-104GI in this indication.

Market Feedback

We believe that there is a general dissatisfaction with current available therapies in the EoE market, and that a product that delivers 6-12 months efficacy; avoids the most troubling adverse events of the currently approved products; and by nature of its delivery and pharmacokinetic profile solves the compliance issues with existing therapies, has the potential to become a leading product in the EoE landscape. To assess market reception to EP-104GI’s target product profile, we sponsored a market research study involving 16 U.S. gastroenterologists/allergists and immunologists and 4 payers.

Feedback supported a new therapeutic with EP-104GI’s proposed characteristics:

EP-104IAR for Osteoarthritis

OA is a chronic progressive disease characterized by deterioration of joint cartilage and inflammation, which results in pain and stiffness, usually in the morning or after a period of inactivity; and loss of joint function which limits daily activities. In normal joints, cartilage acts as a cushion between bones and provides a smooth gliding surface for movement. In OA, the inflammatory processes integral to disease progression damages the cartilage, and over time cartilage wears away, causing bone to rub directly against bone resulting in joint damage, severe pain and disability.

Globally, OA is a leading cause of disability in older adults. Estimates of prevalence and incidence vary according to the definition of OA used (i.e., radiographic(X-Ray) versus symptomatic) and the joints assessed. The global prevalence of knee OA is estimated at approximately 23% in adults over the age of 40. According to a report by the Centers for Disease Control and Prevention, OA is estimated to affect more than 32.5 million adults in the United States alone. A 2018 report estimated there were 14 million people with symptomatic knee OA. OA is also often associated with depression and loss of sleep which can greatly affect quality of life.

Current evidence-based OA treatment guidelines aim to manage signs and symptoms, with the goal of slowing progression if possible. Recommended pharmacological interventions include topical and oralnon-steroidal anti-inflammatory drugs, and IA corticosteroids. IA corticosteroid injections have been used for decades to manage pain and stiffness associated with inflammation in knee OA and have been approved by regulatory authorities as safe and effective. However, IA corticosteroid injections often result in suboptimal patient outcomes because of their short duration of activity and systemic adverse events such as flushing, glucose alterations and cortisol suppression due to the high peak exposures required to maintain efficacious concentrations for prolonged durations. Evidence is also emerging regarding the risk of adverse joint findings and/or OA progression following frequent/repeated immediate release IA corticosteroid injections.

Market Opportunity

Arthritis has profound societal and economic impacts. According to a 2013 U.S. survey, the financial burden from arthritis totaled US$304 billion (US$140 billion in medical costs and US$164 billion in lost wages). OA is the most common joint disorder and the leading cause of chronic disability in older adults, affecting approximately 30 million adults in the United States. OA is the second most expensive condition treated in US hospitals, accounting for US$16.5 billion or 4.3% of aggregate hospital costs in 2013.

The market for OA therapeutics is large and growing. The estimated 2020 global market size for knee OA therapeutics was just over US$5.6 billion and is expected to grow to US$8.7 billion by 2025 (representing a 10% compound annual growth rate for this period). This represents approximately 80% of the US$7.3 billion global OA market. Geographically, about 34.2% of the global spend is attributed to North America, 37.6% to Europe, 21.3% to Asia Pacific and 6.9% to the rest of the world. In the United States, the estimated market for knee OA therapeutics was US$1.8 billion in 2020, and this number is expected to grow to US$2.9 billion by 2025.

Current Treatments

Current OA treatments aim to manage signs and symptoms, in combination with therapy to slow disease progression. There are several international evidence-based guidelines for OA management, each promoting similar treatment escalation paradigms. These approaches are typically stepwise and dictated by patient symptoms, disease severity and comorbidities. They range from general lifestyle measures (e.g., exercise, weight loss, etc.) to physiotherapy, orthopedic aids and orthoses for patients with milder symptoms, followed by pharmacotherapy, and finally surgery and rehabilitation in the most severe patients. The American Association of Orthopedic Surgeons reported 1,168,826 total knee replacement surgeries from 2012 and 2020 and this number is expected to reach 1,921,000 by 2030.

The most recently published OA treatment guidance is the 2019 American College of Rheumatology (“ACR”)/Arthritis Foundation guidelines for OA management. The only pharmacotherapy treatments strongly recommended for knee OA in these guidelines are topical and oral NSAIDs and IA corticosteroids (see below). Tramadol-based opioids and duloxetine are conditionally recommended in specific circumstances and usually in late-stage disease just before total joint replacement is considered. A broad range of othernon-pharmaceutical therapies are also available, such as hyaluronic acid/hyaluronate, platelet rich plasma or mesenchymal stem cells. Many of the major treatment guidelines do not recommend thesenon-pharmaceutical therapies primarily due to a lack of proven efficacy from well-controlled clinical trials.