■Company Overview

1. Company history

Anges ＜4563＞ is a biotechnology venture from Osaka University established in 1999, and the purpose is to commercialize research results on angiogenic effects by administration of the HGF gene (hepatocyte growth factor). For the HGF gene therapy product “Colategen,” an exclusive sales license agreement was concluded with Mitsubishi Tanabe Pharma in 2012 for peripheral vascular diseases in the US market and in the domestic market in 2015. Conditional and time-limited approval was obtained for patients with chronic arterial occlusion domestically in 2019/3, sales began through Tanabe Mitsubishi Pharma in September of the same year, and approval applications for conditional cancellation were made in 2023/5, but as a result of post-manufacturing and sales approval condition evaluation (post-marketing investigation), the application was temporarily withdrawn in 2024/6 because the results of the phase 3 clinical trial could not be reproduced, and changes in development strategies were announced. Also, it was confirmed in 2024/6 that good results were obtained in the late phase 2 clinical trial that had been conducted since 2019/11 in the United States. Furthermore, it was announced in 2024/8 that the Japan-US exclusive sales license agreement with Mitsubishi Tanabe Pharma will be canceled (2024/11/1 in Japan and 2025/2/1 in the US. The cancellation date is different because of Japan's 3 month notice rule and the United States 6 months prior notification rules).

In the other pipeline, a domestic cooperation agreement was concluded with Shionogi Pharmaceutical ＜4507＞ in 2023/3, and since good results were obtained for NF-kappa B decoy oligodna, which is a nucleic acid drug, in the United States, a late phase 1 clinical trial was carried out for chronic disc low back pain, and phase 2 clinical trials began in October of the same year. Also, in 2022/5, a domestic sales agreement was signed with US Eiger BioPharmaceuticals, Inc. (hereafter, Eiger) for the therapeutic agent “Zokinvi” with HGPS (Hutchinson Gilford Progeria Syndrome), also called infant progeria syndrome, and PDPL (processing insufficiency progeroid laminopathy), which is a rare genetic disease, and manufacturing and sales approval was obtained in 2024/1, and sales began in May of the same year started. Furthermore, in 2022/9, it was announced that development of a DNA vaccine for the novel coronavirus infection (Wuhan type), which was being promoted domestically, was discontinued, and at the same time, a joint research agreement was concluded with Stanford University in the United States regarding nasal administration formulations of improved DNA vaccines targeting viral lung diseases including variants of the novel coronavirus infection.

As an M&A alliance strategy, a joint development agreement was concluded with Canada's Vasomune Therapeutics, Inc. (hereinafter, Vasomune) in 2018 (273 million yen invested in 2023/3), and development of a therapeutic drug candidate “AV-001” (Tie2 receptor agonist) targeting the novel coronavirus infection and ARDS (acute respiratory distress syndrome) is being promoted. Also, in 2018, it invested in Israel's MyBiotics Pharma Ltd., which conducts microbiome research and development (74 million yen convertible bonds were underwritten in 2022/11, and impairment treatment has been completed). In 2020, it acquired shares of US Mendo, which aims to develop therapeutic agents for rare genetic diseases using genome editing technology, and made it a subsidiary.

As a business other than drug development, a health laboratory ACRL was established in 2021/4 for the main purpose of testing rare hereditary diseases in newborns, and contract services for optional screening tests are provided in cooperation with CrearID.

2. Business characteristics and business model

The characteristic of the company's business is that gene therapy products, nucleic acid pharmaceuticals, and DNA vaccines, which are pharmaceuticals utilizing the effects of genes, are defined as genetic drugs, and “intractable diseases” and “diseases without effective treatment,” which are social missions and where there is reliable demand, are development target areas. Furthermore, in addition to products developed in-house, development candidate products that match such business policies have been introduced from overseas ventures, universities, etc., to strengthen development pipelines and distribute risks.

The company's business model specializes in research and development (manufacturing is outsourced to an external specialized agency), and by concluding joint development and exclusive manufacturing and sales license agreements with major pharmaceutical companies, the main axis is to acquire contract lump-sum payments, milestone income corresponding to development progress, and royalty income generated at a fixed rate for product sales after marketing. The scale and duration of clinical trials vary depending on target diseases, etc., but it is said that it takes about 3 to 7 years from phase 1 to phase 3 trials. If the results of the clinical trial are good, an application for approval of manufacturing and sales is made to the regulatory authorities, and if there are no problems after an examination period of generally 1 to 2 years, the process is approval/marketing. The probability of success in developing a new drug is low, and it is said that the probability that a lead compound specified in the basic research stage will be sold as a new drug is approximately 1/0.03 million.

In the rare genetic disease testing contract service, expanded neonatal screening tests to investigate rare genetic diseases in newborns are outsourced through our partner CrearID. If a thorough examination is required in the screening test, a genetic test (definitive test) is performed. By starting treatment at an early stage before the onset of the disease through screening tests and subsequent definitive tests, the effect of suppressing the progression of symptoms can be expected. Diseases subject to testing are rare hereditary diseases other than mass screening tests (20 diseases are targeted) carried out by local governments at public expense, and tests are carried out for a fee to applicants. Currently, the diseases that can be tested are 9 diseases*1, such as mucopolysaccharidosis and Fabry disease (boys only), but it is planned to expand in the future. The number of tests for CreaRID is on the rise year by year, partly due to an increase in partner medical institutions and an increase in awareness ※2, and in fiscal 2023 (2024/4 to 2024/3), approximately 0.034 million tests were carried out (about 0.012 million cases in fiscal year 2020, about 0.017 million cases in fiscal year 2022, about 0.02 million cases in fiscal year 2022), of which the company was entrusted with approximately 0.02 million tests. According to CreaRid, of the approximately 0.034 million tests, 56 cases were determined to require examination, and 8 cases were definitively diagnosed in subsequent thorough examinations.

*1 Tests are being carried out for 9 diseases: mucopolysaccharidosis type I, type II, type IVA, type VI, Pompe disease, Fabry disease, adrenoleukodystrophy, spinal muscular atrophy, and severe combined immunodeficiency.

*2 Cooperating medical institutions have 103 facilities (12 prefectures), mainly in the Tokyo metropolitan area, as of 2024/8, and the test implementation rate is around 60 to 80% of in-hospital births.

(Author: FISCO Visiting Analyst Joe Sato)