Building a self-sustaining, world-class specialty biopharmaceutical

Preliminary Results Presentation
11 March 2016
Building a self-sustaining, world-class
specialty biopharmaceutical business
Disclaimer
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securities in Circassia Pharmaceuticals plc (“Circassia”).
Forward-looking statements
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forward-looking statements with respect to the financial condition, results of operations, businesses and
prospects of Circassia. The use of terms such as “may”, “will”, “should”, “expect”, “anticipate”, “project”,
“estimate”, “intend”, “continue”, “target” or “believe” and similar expressions (or the negatives thereof) are
generally intended to identify forward-looking statements. These statements are based on current expectations
and involve risk and uncertainty because they relate to events and depend upon circumstances that may or
may not occur in the future. There are a number of factors which could cause actual results or developments to
differ materially from those expressed or implied by these forward-looking statements. Any of the assumptions
underlying these forward-looking statements could prove inaccurate or incorrect and therefore any results
contemplated in the forward-looking statements may not actually be achieved. Nothing contained in this
presentation or communicated verbally should be construed as a profit forecast or profit estimate. Investors or
other recipients are cautioned not to place undue reliance on any forward-looking statements contained herein.
Circassia undertakes no obligation to update or revise (publicly or otherwise) any forward-looking statement,
whether as a result of new information, future events or other circumstances.
2
Significant progress during 2015
Building a self-sustaining specialty biopharma company

Delivering the pipeline

In-house progress strongly complemented by acquisitions
– Cat SPIRE on track to report phase III data Q2 2016
– Aerocrine brings specialty commercial infrastructure and products
– Grass SPIRE registration study to begin H1 2016
– Prosonix broadens pipeline
– House dust mite SPIRE field study fully recruited
– £275 million fundraising for strategic acquisitions
– Ragweed SPIRE follow-up demonstrates treatment effect
– Funded to deliver: £203.8m cash at 31 December 2015
– Ragweed dose ranging study to begin H2 2016
– Flixotide® pMDI substitute approved in UK
– Triple combination COPD treatment study to report Q2 2016
– NIOX® indication extension study to report H2 2016

Marketing specialty products
− 32% NIOX® sales growth since acquisition
− Next-generation NIOX VERO® launched in China
− Commercial scale-up ahead of first allergy product launch: US sales team 65%
expansion; further doubling by Q1 2017; European expansion underway

3
Building broad and balanced portfolio
– Birch SPIRE moved into clinic; phase IIa study dosing complete
– 3 asthma pMDI substitutes and 2 novel COPD formulations added to pipeline
– Potential for 8 product launches by end 2021
Accelerating specialty commercial strategy
Leveraging common commercial ‘backbone’
4
NIOX® asthma management
US specialist opportunity ~$190m
KOLs
SPIRE allergy immunotherapies
Lead product illustrative peak sales >$500m
Specialists
COPD treatments; asthma therapy substitutes
~$11bn market; targeting ~$2.4bn originator sales
Top prescribers primary care
Primary care
Strong, deep and balanced portfolio
5
Marketed, late-stage and longer-term products
Product
Research
Preclinical
Phase I
Phase II
Phase III /
Substitute
Filed /
Approved
Marketed
NIOX MINO®
NIOX VERO®
Flixotide® substitute*
Cat SPIRE
Seretide® substitute
Flovent® substitute*
Serevent® substitute*
Grass SPIRE
House Dust Mite SPIRE
Ragweed SPIRE
LAMA novel formulation
Birch SPIRE
Triple combination
*Partnered
Pipeline does not include earlier stage programs: Japanese
cedar SPIRE, Alternaria SPIRE, NIOX® home device
6
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Proprietary ToleroMune® technology
Designed to treat underlying disease with minimal side-effects
7
Whole
allergen
ToleroMune® identifies T-cell epitopes
– Short linear stretches of amino acids in allergen sequence
– Binds to antigen presenting cells to induce regulatory T cells
– Identified from blood of allergic individuals
SPIREs – Synthetic Peptide Immuno-Regulatory Epitopes
Short treatment designed to provide efficacy without the safety issues
– Regulatory T cells down-regulate allergic response
– Lack of B-cell epitopes avoids cross-linking of mast cells eliminating
early response / no need to dose escalate
– Synthetic manufacture – no extraction from whole allergens
T cell
epitopes
selected
Final product is
room temperature
stable, lyophilized
vial of 7 peptides
for injection
Silicon crystals
Broadly applicable across range of allergies
– Allergens already identified; no research required
Modern, synthetic, rationally-designed pharmaceuticals
Skin prick +ve cat:
US: 17%1 (53m)
EU: 8-10%2 (30-37m)
8
Cat SPIRE phase IIb
Strong treatment effect at 1 year; persists at 2 years
Chamber study: 202 subjects randomized
1 year follow-up data
Subjects challenged in chamber 3 hours per day for 4
days at baseline and post-treatment
Controlled levels of dander (similar to house with cat)
Primary efficacy measure based on patient-rated
Total Rhinoconjunctivitis Symptom Score (TRSS)
Overall TRSS
improvement 3.9 vs.
placebo (p = 0.01)
Comparison of TRSS improvement from baseline
post treatment vs placebo
Scoring system required by regulators
Measured on 4-point scale:
0 (absent); 1 (mild, barely noticeable); 2 (moderate,
annoying / troublesome); 3 (severe, incapacitating)
SPIRE studies use 8 symptoms = 24-point scale:
cat SPIRE used sneezing & runny / blocked / itchy
nose & itchy / watery / red / sore eyes
1 Arbes et al. J Allergy Clin Immunol. 2005 Aug;116(2):377-83
2 Bousquet et al. Allergy. 2007: 62: 301-9
Published: J Allergy Clin Immunol. 2013 Jan;131(1):103-9.e1-7
Cat SPIRE phase III on track to report Q2 2016
Multi-year follow up recruitment ongoing
9
Phase III on track
Period 1
Period 2
Screening
Study Medication Administration (every 4 weeks ± 2days)
End of Dosing
Assessment
(2 wks ± days since
last dose)
Visit
1A
1B/C
2A
2B
3A………………………………………….3H
3I
4A 4B
4C 4D
4E 4F
5
Period 3 (Post Administration Collection)
Baseline Allergy
Evaluation
x3 wks
PAC1
x3 wks
PAC2
x3 wks
Follow-Up
(3-10 days after PAC3)
Randomisation
Week
-8
-3
2–5 year follow-up on track:
424 subjects enrolled*
PAC3
x3 wks
0
20-22
28
30
37-39
52-54
Year 2
Year 3
Year 4
Year 5
Reporting of Health Economics (Subjects)
Quarterly Visits to confirm and evaluate Safety Information (Sites)
Annual
Allergy
Evaluation*
Annual
Allergy
Evaluation*
Annual
Allergy
Evaluation*
Annual
Allergy
Evaluation*
* Timed to occur annually after Baseline Allergy Evaluation Period in CP007
*At 1 March 2016
CATALYST: designed to deliver
Study design
 Primary endpoint fully powered: improvement in combined TRSS / rescue medication use
one year after start of dosing vs placebo
― Recruitment 19% over target (n=1,409); retention rate on track
― Designed with 99% power vs placebo
― Powered for 25% improvement cf 40% day 4 symptom improvement in phase IIb; FDA requires at
least 15% treatment effect*
― Assumed 50% greater variability than observational field study
― Powering sufficient if robust TRSS improvement alone with
little or no rescue medication use
 Inclusion criteria minimize confounding factors
― Moderate to severe allergy: baseline TRSS ≥10
― Subjects live with cat(s) in the home
― Centers in cold dry locations to minimize HDM
* With upper bound of 95% confidence interval minimum10%
10
CATALYST: delivering commercial opportunity
Broad range of supportive endpoints
 Secondary endpoints
― Total Rhinoconjunctivitis Symptom Score (TRSS)
― Rescue medication use
― Nasal symptoms
― Ocular symptoms
― Rhinoconjunctivitis quality of life
― # of days with no severe / moderate TRSS without rescue medication use
 Exploratory endpoints
― Health economic (work/school days lost; hospital/doctor visits; non-rescue medication treatment)
― Work place productivity & activity impairment/classroom impairment
― Pittsburgh sleep quality index
― Impression of change in rhinoconjunctivitis score
― Change in asthma control in asthmatics
11
Progress achieved across allergy portfolio
2015 progress
 Cat SPIRE pediatric study (n=15; aged 5-11 years) completed to
support EU filing
 Ragweed SPIRE two-season follow-up study complete
 Ragweed SPIRE dose-ranging field study on track to initiate 2016
 House dust mite SPIRE field study fully recruited (n=715); results
expected H1 2017
 Grass SPIRE registration study on track to begin H1 2016
 Birch SPIRE clinical development initiated; dosing complete (n=64);
results expected H2 2016
12
Ragweed SPIRE phase IIb two-season data
Field study follow-up over additional pollen season
Field study endpoints
Field endpoint: combined TRSS (0 -24 scale) and
rescue medication use (RMS) score (0-3 scale)
- Combined Score = (TRSS / 8) + (RMS); 0-6 scale
- Measured pre-season to peak & across whole season
Treatment effect demonstrated vs placebo
despite no further treatment
- Improvement for all regimens pre- to peak season (1013%) and across whole season (15-21%)
- Highest dose regimen achieved greatest effect across
whole season (21%)
Treatment effect considerations
- FDA requires at least 15% treatment effect1
- World Allergy Organization: at least 20% treatment
effect clinically meaningful
1 With upper bound of 95% confidence interval minimum10%
Combined Score and ragweed pollen count
13
Large-scale studies on track to begin 2016
Grass SPIRE registration study
 Innovative design follows consultation with FDA
and EMA
― Single field study: 8 x 6nmol vs placebo
― Positive safety study enables inclusion of
controlled asthmatics
― Adaptive design allows mid-study powering
adjustment
― Initial 400 subjects report combined score
improvement
― Expansion cohort already recruited
― Further randomization ensures robust powering
(expectation n=1,100)
― On track to initiate H1 2016
― Results anticipated H2 2018
14
Ragweed SPIRE dose-ranging study
 Large-scale field study
― Results to date suggest optimal dose may not yet
be reached
― Highest dose performed best in previous studies
(2011 and 2014)
― Dose-ranging study comparing best performing
dose to date (8 x 12nmol) with double dose
― Field study comparing improvement in combined
symptom and rescue medication use vs placebo
― Recruitment target approximately 450
― On track to initiate 2016
― Dosing completion before 2017 season
― Results expected H1 2018
15
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Near-term pipeline & longer-term
novel formulations
16
Device types
Significant pricing potential
Focus on pMDI market segment
‒ 73.5% of pre-entry brand
price for first to market
generic in US during
exclusivity1
Directly substitutable products
– Limited development
pMDI
‒ 47.8% of pre-entry brand
price for only on market
generic in US1
DPI
– Modest commercial infrastructure required
– Challenging to achieve for respiratory products
– Non-substitutable competitors require promotion
Direct
sales
force
Novel combinations / formulations
KOLs
− Longer and more extensive development
− Majority of market in primary care
Specialists
− Circassia to target specialists
− Partner for phase III and targeting primary care
Top prescribers primary care
Partner
sales
force
1 Bureau of Economics, Federal Trade Commission, Working Paper No 317. The effect of generic drug competition on generic drug prices during the Hatch-Waxman 180-day exclusivity period. April 2013.
Primary care
Novel technology controls API properties
Technology controls
‒ Size
Significant potential benefits
Directly substitutable products
‒ Shape
‒ Surface properties
‒ Potential for first to market with
therapeutic equivalence, all strengths,
similar device and same formulation
‒ Manufacturability
Novel products
‒ Aerodynamics
‒ Product stability
‒ Product performance
Engineered API
‒ Optimized combinations and novel
formulations
17
Lead product approved in UK
Collaboration with Mylan
Successful EU filing
Flixotide®
substitute (EU)
Mylan collaboration
Targets substitution of Flixotide® pMDI
Mylan has marketing rights in
major territories (inc US and EU)1
Decentralized procedure – UK
Reference Member State
Product confirmed approvable Nov 2015
Subsequently approved in all three
strengths in Dec 2015
FDA guidelines require PK and
PD studies in US
Approval based on in vitro
demonstration of equivalence only
Estimated $820m originator sales (>60% US)
1 USA, Canada, Australia and New Zealand, India, Europe (including the EU and EFTA states (Iceland, Liechtenstein, Norway and Switzerland)), Turkey, Russia and CIS
Originator sales estimate based on GSK Annual Reports 2011, 2014 and 2015 and selected IMS data 2011 and 2012
Flovent®
substitute (US)
18
Seretide® substitute targets $1.5bn originator
Seretide®
substitute
Salmeterol (PSX2005 vs originator)*
Fluticasone (PSX2005 vs originator)*
Plasma concentration (pg / ml) by
time (mins) [geometric means n≤75]
Plasma concentration (pg / ml) by time (mins) [geometric means n≤75]
Plasma concentration (pg / ml) by
time (mins) [geometric means n≤75]
*Preliminary non-QA results; low strength fluticasone administered via spacer
AUC similar for salmeterol and fluticasone; Cmax similar for fluticasone (PSX2005 vs originator)*
Data suggest formulation may contain insufficient salmeterol fine particles
19
Triple combination clinical development
Engineered mono blend
LAMA
LABA
Novel triple
presentation
2+1 triple formulation
ICS
LAMA
LABA
ICS
Triple combination1 clinical study initiated H2 2015 (n=38)
Single-dose stage complete; repeat-dose near completion with results expected Q2 2016
1 Inhaled corticosteroid (ICS) / long-acting beta agonist (LABA) / long-acting muscarinic antagonist (LAMA)
2 Respiratory Market 2025: Taking A Deep Breath And A Deep Dive – Jefferies 2013 Equity Research
20
21
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Leadership in FeNO asthma management
Meeting key clinical need in major therapeutic market
NIOX® is only point-of-care FeNO device available across major markets
Clinical evidence shows FeNO measurement improves asthma management
–
–
–
–
Improves diagnosis
Improves determination of inhaled steroid responsiveness and control through tailoring use
Improves monitoring of treatment compliance
Potential to reduce exacerbations
NIOX® sold direct to specialists in US & Germany; distributors elsewhere
− Revenues from sale of devices and repeat tests
Extensive big pharma use in clinical studies
−
Validates importance of FeNO; trains physicians; helps establish FeNO in market
22
Next generation roll-out underway
Product improvements offer major opportunity
23
Transitioning to
next generation
Direct sales
NIOX MINO®
NIOX VERO®
EU 2004, US 2008,
China 2010, Japan 2013
EU 2013, US 2014,
Japan 2015, China 2015
Ages 4+ in EU; 7+ in US
Ages 4+ EU; 7+ in US
10 second test; 90 second result
6 and 10 second test; ~60 second result
Monitor lasts 3 years or 3,000 tests
Monitor lasts 5 years or 15,000 tests
Limited portability
Fully portable; enhanced interface
Long-term upside potential from home use device currently in planning
Distributors
NIOX VERO® China launch August 2015
KOL and distributor meetings
24
Continuing strong growth
Foundations in place to boost NIOX® sales
Positioned for growth
 Expansion of US indication down to 4 years old – study underway
 Potential expansion into primary ciliary dyskinesia diagnosis
− NIOX VERO® adapted for nasal sampling
− Study planned with ethics approval pending
 Growing evidence of asthma misdiagnosis supports NIOX®
− 53.5% over-diagnosis in recent childhood primary care study*
− NICE reports 30% treated for asthma no longer have signs of condition
 NICE primary care implementation project March – Oct 2016
− To ensure smooth introduction of new asthma diagnosis / monitoring guideline
− FeNO included in proposed guideline (target publication July 2017)
*Br J Gen Pract 2016; DOI: 10.3399/bjgp16X683965
25
Strong performance since acquisition
Ideal fit with Circassia’s commercialization strategy
26
US specialist opportunity
Robust revenue growth
 18% CAGR 2010-14
Direct
sales
force
~$190m
 Post acquisition (19/06/15)
revenues £10.3m
 32% growth vs same
period 2014
KOLs
Specialists
US primary care opportunity
 Targeting continued
strong growth
Top prescribers primary care
~$610m
Partner
sales
force
Primary care
27
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Commercial infrastructure expansion
Significant progress in 2015
US headquarters established in Chicago
Recruited commercial leadership
— Commercial operations, marketing, medical affairs,
sales, supply/distribution
Integrated Aerocrine organization
— Direct sales in US and Germany
Subsequent dramatic expansion
— Commercial team now over 100-strong
— Medical affairs across key territories
— Reimbursement expertise established
— Targeting >100-strong field team by Q1 2017
— EU direct sales territory review initiated
— Discussions in France to establish direct presence
28
Commercial team enhancement
29
Realigned territories & focused target lists
Significant growth in US sales force
• More focused, smaller territories
• Establishing Circassia presence in key
US markets where Aerocrine was absent
• Closer to key physicians
Field Sales
Team
Revamped sales training
Improved territory management tools
• All sales training materials revised
• Veeva CRM roll-out
• On-boarded / retrained entire field
sales team → improved consistency
• Account profiling, call planning and
promotional material delivery
• Reorganized around clinical sell
Updated incentive compensation
• Aligned with growth strategy
• Attractive to reward and retain top talent
First US national sales meeting Dec 2015
Follows over 2,000 applications for 28 open positions
30
First global NIOX® brand campaign launched
31
Customer research in US and 3 EU countries resulted in
compelling brand positioning
— “FeNO by NIOX®” — objective measure for diagnosing and
monitoring asthma
— Engages in complexities of asthma management and clinical
benefits of measuring airway inflammation by FeNO testing
Research maps cat allergy ‘patient journey’
Physical, emotional and social suffering
US / EU research with cat allergy sufferers confirms
significant need for accessible long-term relief
Cat allergy is physically draining and debilitating
Cat allergy has a major impact on mood and emotions
Embarrassment and guilt create self-imposed boundaries
Patients cut social interactions and relationships affected
“I want to have a life, I want go out and
do things without living in fear I turn
into a coughing, mucus building,
walking, sneezing, coughing person that
everyone runs from like Godzilla.”
- Patient, Rapidfire, US
“You feel empty, ill, tired,
unmotivated and useless.”
- Patient, Online Spotlight, Germany
32
Pricing and treatment research confirm
major market opportunity
Opportunity for cat SPIRE
US cat SPIRE target population
Cat-allergic individuals
Illustrative peak sales of
c.$500-700m for US and EU
US: 200,000
x
Equals 5 of 34 new cat
allergy patients / month
already coming to allergist
EU: 50,000
$2,600 = $520mm
Consulting a specialist
Offered IT
~24 million1
~1.3 million
$1,500 (€1,100) = $75mm
1.5 million patients in
EU already on allergy
immunotherapy
EU pricing: Discount to
Grazax cost of €2.5-5.3k
over 3+ years
Secondary
focus
Patients not
offered IT
~1.0 million
Primary focus
Patients
declining IT
US pricing: Supported
by third-party research
x
1 Kantar Health Quantitative Cat Allergy Report 2010
33
Accept IT
(~378k)
Complete
IT (~60k)
Secondary
focus
Patients failing to
complete IT
34
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Financial highlights
Year ended 31 December 2015
Raised £275m gross proceeds
–
–
–
–
–
–
Acquisition of Prosonix completed 15 June
Acquisition of Aerocrine completed 18 June (92.6% of shares; increased to 97.9% 31 Dec)
Consideration for Aerocrine £138.3m
Consideration for Prosonix £100.0m (of which £30.0m contingent on lead product UK approval)
Aerocrine loan £28.7m repaid to lenders (OrbiMed/Novo) 29 June
Deal costs £12.8m
Loss for financial year £50.0m (2014: £35.1m)
– H1 £21.7m (H1 2014: £16.2m)
– H2 £28.3m (H2 2014: £18.9m)
Cash at 31 December 2015 £203.8m (31 December 2014 £186.6m)
– Cash acquired with businesses £37.7m
– Contingent £30.0m payment paid January 2016
35
Income statement
Year ended 31 December 2015
36
Research & development
37
Cat allergy immunotherapy
– CP007 (phase III) recruitment complete Dec 2014
– 2–5 year follow up initiated 2014
HDM allergy treatment
– Recruitment into TH005 (phase IIb field trial)
Ragweed allergy therapy
– Recruitment into TR006 (phase II) complete 2014
Birch and Japanese cedar allergy treatments
– Birch allergy therapy first–in-human trial fully recruited
Respiratory investment
– Triple combination clinical study (first stage complete)
– PK testing for Seretide® pMDI substitute
38
1
SPIRE allergy therapies
2
Respiratory pipeline
3
NIOX® asthma management
4
Commercial progress
5
Financial results
6
Summary
Strong newsflow
39
News
Date*
Description
Grass SPIRE support study
H1‘15
Observational study (TG003) reports (n=102)

Grass SPIRE phase II results
H1‘15
Phase II controlled asthmatic study (TG004) reports (n=54)

NIOX MINO® / NIOX VERO® sales data
H2’15
Interim results with H1’15 sales results

Flixotide® substitute approval outcome
H2’15
MHRA response to filing

Cat SPIRE safety study complete
H2‘15
Pilot pediatric safety study (CP009) completes (n=15)

Ragweed SPIRE phase IIb complete
H2’15
Phase IIb follow-up field study (TR006A) completes (n=249)

HDM SPIRE study recruitment
H2’15
Complete phase IIb (TH005) field study recruitment (n=715)

NIOX MINO® / NIOX VERO® sales data
H1’16
Year end results with H2’15 sales

Cat SPIRE phase III results
H1‘16
Phase III study (CATALYST) reports (n=1,409)
Grass SPIRE registration study
H1‘16
Recruitment starts for registration study (n=~1,500)
Triple combination study results
H1’16
Repeat dose study reports (n=38)
NIOX MINO® / NIOX VERO® sales data
H2’16
Interim results with H1’16 sales results
Ragweed SPIRE dose-ranging study
H2’16
Phase IIb study initiation (n=~450)
Birch SPIRE study results
H2’16
Study reports following birch pollen season (n=64)
NIOX® US label extension study
H2’16
Completion of study in four to six year olds
Cat SPIRE filing
H2‘16
File for marketing approval
HDM SPIRE study complete
H1’17
Phase IIb field study (TH005) completes (n=715)
Cat SPIRE two-five year follow-up
H1’17
Phase III follow-up two year follow-up completes
Seretide® pMDI substitute filing
H2’17
Initial MAA filing
*To be included in announcements as appropriate and in-line with financial calendar including half-year / full-year results
Good strategic progress
Building a self-sustaining specialty biopharma company
 Business built on three franchises leveraging common infrastructure
−
SPIRE immunotherapies targeting leading allergies
−
NIOX® market-leading asthma management products
−
Respiratory portfolio of particle-engineered asthma & COPD products
−
Franchises leverage novel technologies and out-sourced business model
−
Commercialization exploits common infrastructure focused on allergy / asthma specialists
 Strong and balanced growth platform
−
Cat allergy phase III data on track for Q2 2016
−
Grass allergy registration study on track to begin H1 2016
−
NIOX® products positioned for growth; 32% revenue growth since acquisition
−
Respiratory technology validated; lead product approved
−
Potential for 8 product launches by end 2021
−
Funded to deliver (£203.8m cash1 at 31 December 2015)
1 Cash, cash equivalents and short-term bank deposits (unaudited)
40
Contact us
Office
Investors
Financial and Corporate
Communications
Circassia
Northbrook House
Robert Robinson Avenue
Oxford Science Park
Oxford OX4 4GA
United Kingdom
Steven Harris, CEO
Julien Cotta, CFO
FTI Consulting
200 Aldersgate
Aldersgate Street
London EC1A 4HD
United Kingdom
W: www.circassia.com
E: [email protected]
T: +44 (0) 1865 405560
T: +44 (0) 20 3727 1000
E: [email protected]