8-K: DiaMedica Therapeutics Announces First Patient Dosed in ReMEDy2 Stroke Trial and Provides Q1 2024 Financial Update

DiaMedica Therapeutics has dosed the first patient in the ReMEDy2 stroke trial, expanded its clinical operations team, and reported $46.5 million in cash with a runway to 2026.

Summary

• DiaMedica Therapeutics announced the first patient has been dosed in the ReMEDy2 trial for acute ischemic stroke (AIS).
• The company has expanded its clinical operations team to support global expansion of the trial.
• DiaMedica reported $46.5 million in cash, cash equivalents, and investments as of March 31, 2024, with a financial runway to 2026.
• Eight clinical sites are now open for the ReMEDy2 trial, with the majority of U.S. sites expected to be activated by the end of the third quarter of 2024.
• Regulatory filings in Canada are expected this month, with site activation anticipated to begin in the fourth quarter of 2024.
• Australian site activation is expected to commence before the end of 2024.
• Full enrollment for the 144 patients for the interim analysis is expected in the first quarter of 2025.
• Net cash used in operating activities for the three months ended March 31, 2024, was $6.7 million, compared to $5.1 million for the same period in 2023.
• Research and development expenses increased to $3.7 million for the three months ended March 31, 2024, compared to $3.6 million for the same period in 2023.
• General and administrative expenses increased to $2.1 million for the three months ended March 31, 2024, up from $1.9 million for the same period in 2023.
• Other income, net, was $597 thousand for the three months ended March 31, 2024, compared to $256 thousand for the same period in 2023.

Sentiment

Score: 7

Explanation: The document presents a generally positive outlook with the commencement of the ReMEDy2 trial and a strong cash position. However, increased operating expenses and R&D costs temper the overall sentiment.

Positives

• The ReMEDy2 trial has commenced with the first patient dosed.
• The company has a strong cash position of $46.5 million, providing a runway to 2026.
• Clinical site activation is progressing in the U.S., Canada, and Australia.
• The company is working with top-tier stroke centers for patient participation.
• Other income increased due to higher interest income from marketable securities.

Negatives

• Net cash used in operating activities increased to $6.7 million for the quarter.
• Research and development expenses increased to $3.7 million for the quarter.
• General and administrative expenses increased to $2.1 million for the quarter.
• Cash, cash equivalents and investments decreased from $52.9 million to $46.5 million since December 31, 2023.

Risks

• The company faces risks related to the timing of site activations and enrollment in the ReMEDy2 trial.
• There are risks associated with regulatory applications and approval timelines.
• Unfavorable results from the ReMEDy2 trial or other clinical trials could impact the company.
• The company relies on third parties to conduct clinical trials.
• The company needs to continue to obtain funding for its operations.
• The adaptive design of the ReMEDy2 trial could lead to changes in enrollment targets and other aspects of the trial.
• COVID-19, hospital staffing shortages, and global supply chain issues could impact the business and clinical trials.

Future Outlook

DiaMedica expects R&D expenses to increase moderately as the ReMEDy2 trial expands globally, while G&A expenses are expected to remain steady. The company anticipates full enrollment for the interim analysis in the first quarter of 2025 and has a cash runway to 2026.

Management Comments

• Dr. Lorianne Masuoka, DiaMedica's Chief Medical Officer, stated, 'We are diligently working to involve and mobilize top-tier stroke centers, laying a solid groundwork for patient participation.'
• Dr. Masuoka also noted, 'The enthusiasm from premier research sites is uplifting, and we remain dedicated to bringing DM199 to stroke patients.'

Industry Context

DiaMedica is developing DM199, a recombinant form of KLK1, for acute ischemic stroke, a market with limited effective treatment options. The company is leveraging the established use of non-recombinant KLK1 in Asia for similar conditions. The ReMEDy2 trial is a pivotal study that could lead to regulatory approval and commercialization of DM199.

Comparison to Industry Standards

• DiaMedica's approach of using a recombinant form of KLK1 is unique compared to the traditional tissue-extracted KLK1 used in Asia.
• The ReMEDy2 trial is designed as an adaptive, randomized, double-blind, placebo-controlled trial, which is a standard approach for clinical trials in the pharmaceutical industry.
• The company's cash runway to 2026 is a positive sign, indicating financial stability for ongoing clinical development.
• The company is targeting a 144 patient interim analysis which is a reasonable size for a phase 2/3 trial.
• The company is working with the Canadian Stroke Consortium and the Australian Stroke Trials Network which is a common approach for global clinical trials.

Stakeholder Impact

• Shareholders will be impacted by the progress of the ReMEDy2 trial and the company's financial performance.
• Employees will be impacted by the expansion of the clinical operations team.
• Patients with acute ischemic stroke may benefit from the development of DM199.
• Suppliers and vendors will be impacted by the company's clinical trial activities.

Next Steps

• Continue site activation and patient enrollment for the ReMEDy2 trial.
• Submit regulatory filings to Health Canada.
• Activate study sites in Canada and Australia.
• Complete full enrollment for the interim analysis in the first quarter of 2025.
• Monitor and manage cash flow and operating expenses.

Key Dates

Keywords

DiaMedica Therapeutics, DM199, ReMEDy2, Acute Ischemic Stroke, Clinical Trial, Biopharmaceutical, Rinvecalinase alfa, Neurological Disorders, Cardio-renal Disease, Cash Runway