Sareum marks progress with 'better-than-expected' profit

03:20 EDT 5 Jun 2016 | Proactive Investors

News flow of late for Sareum Holdings Plc (LON:SAR) has focused more on US company Sierra Oncology Inc (NASDAQ:SRRA), which has licensed Sareum’s lead candidate. It’s a checkpoint kinase 1 (Chk1) inhibitor cancer candidate, named SRA737, and Sierra holds the exclusive worldwide licence for its development. At present, Sierra has two trials in progress that were recently amended to include cohort expansions of prospectively selected patients with tumours that have genetic abnormalities thought to confer sensitivity to Chk1 therapy. Chk1 controls a cancer cell's response to DNA damage, which could be caused by the disease itself or intentionally caused by chemotherapy or radiotherapy. Although it is still early days, Sierra said it has yet to see any dose limiting toxicity in the trials. All of which is good news for Sareum and the possibility of milestone payments relating to SRA737. Milestone payments from Sierra Oncology Payments from Sierra enabled the drug developer to post a maiden profit back in February. The Sierra licence triggered an upfront payment of US$1.9mln to Sareum meaning an overall profit of £573,000 (£485,000 loss) in the half year to December. Cash holdings were £2.34mln (£335,000). Importantly, with development funding for Chk1 now arranged it frees the company up to accelerate work at its three other programmes and especially TYK2 a compound that is targeting psoriasis, rheumatoid arthritis, and other autoimmune disorders, in partnership with SRI International. Since the half year the product has passed a further milestone worth US$550,000 to Sareum. Tim Mitchell, Sareum’s chief executive, said that “No further payments from the Chk1 licence agreement are expected in the current period and future payments will be dependent on Sierra Oncology achieving further milestones or Sareum striking licensing agreements with its other programmes.” Even so, it still expects profits and cash at bank to be ahead of current market expectations at the end of the current financial year. TYK2 work can now accelerate "We have previously reported the efficacy of our TYK2 inhibitors, including SAR-20347, in disease models of psoriasis, rheumatoid arthritis, and colitis, and, in the latter two cases, how our compounds compare favourably with a marketed JAK family kinase inhibitor," he added. SAR-20347 has also received a US$360,000 grant to investigate its use as potential treatment for lupus. The TYK2 inhibitor has also shown promise in a feasibility study to see whether it might work in t-cell acute lymphoblastic leukaemia (T-ALL), a rare and difficult-to-treat form of leukaemia which occurs in late childhood and early adolescence. This investigation culminated in a T-ALL disease model study. Sareum's compounds were well tolerated, presented good exposure to plasma and tumour tissue and showed a dose-dependent effect on a biomarker of TYK2 inhibition and tumour reduction of up to 80%. The early-stage work was supported by Innovate UK and a grant of £140,000 and Mitchell said there are "We believe commercial interest in this programme should increase further as a result, and we are grateful to Innovate UK for their financial support,” said Sareum’s chief scientific officer, Dr John Reader.   “The positive results from this feasibility award may lead to other opportunities to secure additional funding awards to advance the programme further." --Updates for full-year profit and cash at bank guidance--

Original Article: Sareum marks progress with 'better-than-expected' profit


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