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Index Pharmaceticals at a profitable crossroads

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Index has a focus on inflammatory/autoimmune diseases and is planning the start of a phase 3 in ulcerative colitis (UC) with Cobitolimod. The UC market is valued at 5-6 billion dollars. Furthermore, the discovery plattform of DIMS has a large potential - see below!

Index crossroads is marked phase 3 under own auspecies requiring further financing OR a to close a licensing deal.

The latter could certainly also result in Index being acquired at a very large premium to present stock valuation.

Big Pharma has interestingly at present a low point in the number of phase 3 assets which certainly will change going forward, either through licensing or M&A. Covid-19 has certainly been a factor but the downward trend has been going on for a number of years now.

We will not speculate in how financing of an own phase 3 will play out but the company has solid owners and, to this day, the fundraising climate among institutions has proven to also be solid, especially for late stage assets. Furtermore we are convinced that the company is digging into the various possibilities of non-dillutive financing which are available to an innovative company like Index.

Below we have made an analysis of the comptetitive space relating to the dilibating disease Ulcerative Colitis. Due to the strong unmet medical need and the large market opportunity many Big Pharmas are contemplating their strategies. This is especially true since two large autoimmune disease pharmaceuticals, Remicade and Humira are now under pressure from biosimilars entering the market, apart from the UC focused pipeline globally. The area is competitive but Index data from its phase 2 stands out very well besides being very attractive because of its low tox profile compared to other candidates and products in the market. Cobitolimod can become a monotherapy in it's own right but can also become an excellent combo therapy together with other drugs in the market, such as e.g. biosimilars or others.

In the patients choice, a drug that can be taken at home (not in hospitals) which also has very low side effects is truly attractive. All this is something the stock market has shown little or no appreciation over.


From our analysis of the market/candidate map created thru research the following conclusions are drawn as to which Big Pharmas are the most likely to have an interest in Cobitolimod (without order)

Immediate possibilities

Takeda - has one marketed drug but had to shelf a phase 2 candidate this spring from the Shire acquisition .

Roche - has nothing in the market until at the earliest 2026.

Merck&Co - has a Humira biosimilar on the market but nothing else in phase 2/3.

GSK - has nothing in the market until at the earliest 2026.

Boeringer Ingelheim - has a Humira biosimilar on the market but nothing else in phase 2/3.

BMS - the phase 3 data presented a couple of weeks ago were, to say the least limited, which could be an indication that Ozanimod results were comparatively weak. If so they will not have anything on the market until earliest 2025/26.

Possible partners before/after own phase 2 or 3 results coming within 3-8 months

Amgen/AZ - has a phase 2 readout of their joint Brazilikumab in August.

Amgen - has biosimilars to both Remicade and Humira but nothing else in phase 2 or 3.

Eli Lilly - has phase 3 readout in September of Mirikusumab and nothing else in phase 2 or 3.

Esai - has a phase 3 readout in November of AMJ300 and nothing else in phase 2 or 3.

Gilead - their Figoltinib (with Galapagos) didn't show any inspiring phase 2 results a couple of weeks ago. They have a phase 2 readout of their own GS-4875 in April next year.

Apart from the above mentioned readouts a number of other phase 2 readouts are expected for the coming 12 months, mostly from smaller biotechs.

It is good to know that the data achieved by Index in relation to efficacy and safety are very good whichever way - own phase 3 or licensing - the company decides to pursue.


Cobitolimod (Dims 0150) comes from the plattform that so far has only been tested in a few pre-clinical trials as a result of Vinnova financing. The plattform is very well patented, especially in respect of the 3d structures of the oligoneutides which are named " DNA-based Immune Modulating Sequenses". In total Index has characterized some 150 DIMS structures. Each of these structures has the ability to "tickle"/stimulate the receptor TLR9 in such away that the immune system creates a cascade of different cytokine responses depending on the structure of the DIMS given to a person. Some DIMS are inducing the immune system to create Interferons and some various interleukins such as e.g. IL-10 or a combo of these or other cytokines (Cytokines are a category of small proteins important in cell signaling)

In this respect it is very interesting to notice that what COVID-19 does when a person is infected is with the virus. The virus is actually blocking the immune systems ability to produce interferons which would be produced otherwise. Over the last couple of weeks there has been an increasing number of medical articles pointing at that it could be beneficial to inject recombinant interferons in the early stages of Covid-19 infections. Recombinant interferons are hard to produce and expensive. What an appropriate DIMS structure could do is make endogenous interferons, I.e have the body produce interferons again - the implications of this are truely mind-boggling!!

DIMS opens up opportunities for the treatment of different inflammatory conditions, in which the immune responses are imbalanced. In addition to cobitolimod, several other DIMS have shown potent induction of anti-inflammatory cytokines in vitro and anti-inflammatory effects in vivo in different animal models (e.g. Multiple Sclerosis, Asthma, Cancer, Ischemia). The Company’s in vivo data from studies in animal models demonstrate a great potential of the DIMS portfolio, and the collected data also supports several routes of administration being applicable to the DIMS, e.g. subcutaneous, rectal, nasal and topical application.

Index has two good possibilities to grow, Cobitolimod and the DIMS concept. To date the reasoning in the company has been that Cobitolimod will prove the DIMS concept. The Board and Management have not communicated any changed view on the concept - it has more been a matter of the above reasoning but that might change when Big Pharma or the stock market realize the great potential.

If you want to see a schematic picture of parts of the DIMS portfolio and cytokines generated, look at the Capital Markets Day video below:

Introduction - Peter Zerhouni, CEO InDex Pharmaceuticals

From 7.50 to 8.30 into the video.

If you are very technically interested read at least the background/intro to the patent from 2017. Methods for identifying biologically active oligonucleotides capable of modulating the immune system (patent number 9593337)

In summary - if you are not owner of this fantastic company - maybe you should become one. Good luck!

Disclosure: The authors own shares in Index Pharmaceuticals and Engblom was Board member from 2007-2012.


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