Immunic, Inc. (NASDAQ:IMUX) is a biotechnology company developing a clinical pipeline of selective oral immunology therapies focused on treating chronic inflammatory and autoimmune diseases. The company has made significant strides in advancing its lead asset, vidofludimus calcium, through late-stage clinical trials, while also progressing its innovative IMU-856 program targeting gastrointestinal disorders. With a strong financial position and a robust intellectual property portfolio, Immunic is well-positioned to deliver on its promising pipeline and create value for shareholders.

Business Overview

Immunic is headquartered in New York City with its main operations in Gräfelfing near Munich, Germany. The company had approximately 80 employees as of May 1, 2023. Immunic's lead development program, vidofludimus calcium (IMU-838), is in Phase 3 clinical development for patients with multiple sclerosis (MS) and has shown therapeutic activity in Phase 2 clinical trials in patients suffering from relapsing-remitting MS, progressive MS, and moderate-to-severe ulcerative colitis.

The company's second program, IMU-856, is an orally available and systemically acting small molecule modulator that targets Sirtuin 6 (SIRT6), a protein which serves as a transcriptional regulator of intestinal barrier function and regeneration of bowel epithelium. Based on preclinical data, Immunic believes IMU-856 may represent a unique treatment approach for a broad range of serious gastrointestinal disorders.

Immunic also has the IMU-381 program, which is a next-generation molecule being developed to specifically address the needs of gastrointestinal diseases.

Financials

Immunic has not generated any revenue from product sales to date and has incurred operating losses in each year since its inception in 2016. For the full year 2023, the company reported a net loss of $93,612,000, with no revenue and an operating cash outflow of $70,828,000. The company's free cash flow for the year was negative $71,162,000.

In the first quarter of 2024, Immunic reported a net loss of $29,584,000, with no revenue. Research and development expenses were $18,736,000, while general and administrative expenses were $5,145,000 for the quarter. The company's operating cash outflow was $23,969,000, and free cash flow was negative $24,000,000 for the first three months of 2024.

Despite the ongoing losses, Immunic's financial position has been strengthened by a successful private placement financing completed in January 2024. The company raised $80 million in the first tranche of this financing, with the potential for an additional $160 million in the second and third tranches, subject to certain conditions. As of March 31, 2024, Immunic had $97,312,000 in cash and cash equivalents, which the company expects will fund its operations into the third quarter of 2025.

Clinical Pipeline and Upcoming Milestones

Vidofludimus Calcium (IMU-838)

Vidofludimus calcium, Immunic's lead development program, is being evaluated in several ongoing clinical trials to support potential approval for patients with MS in major markets. The Phase 3 ENSURE program, comprising twin studies evaluating the efficacy, safety, and tolerability of vidofludimus calcium versus placebo in relapsing multiple sclerosis (RMS), is ongoing. Additionally, the Phase 2 CALLIPER trial of vidofludimus calcium in progressive multiple sclerosis (PMS) is designed to corroborate the drug's neuroprotective potential.

In October 2023, Immunic announced positive interim data from the CALLIPER trial, showing biomarker evidence that vidofludimus calcium's activity extends beyond the previously observed anti-inflammatory effects, further reinforcing its neuroprotective potential. Top-line data from the CALLIPER trial, for which the recruitment of 467 patients was completed in August 2023, is expected to be available in April 2025.

Immunic expects to report an interim futility analysis of the ENSURE program in late 2024 and to read out the first of the ENSURE trials in the second quarter of 2026, with the read-out of the second ENSURE trial expected in the second half of 2026.

IMU-856

Immunic's second program, IMU-856, is an orally available and systemically acting first-in-class small molecule modulator of Sirtuin 6 (SIRT6). Based on preclinical data, the company believes this compound may represent a unique treatment approach, as the mechanism of action targets the restoration of the intestinal barrier function and bowel wall architecture in patients suffering from gastrointestinal diseases such as celiac disease, inflammatory bowel disease, short bowel syndrome, and irritable bowel syndrome with diarrhea.

Data from a Phase 1b clinical trial in celiac disease patients demonstrated positive effects for IMU-856 over placebo in four key dimensions of celiac disease pathophysiology: protection of the gut architecture, improvement of patients' symptoms, biomarker response, and enhancement of nutrient absorption. Immunic is currently preparing for Phase 2 clinical testing of IMU-856 in patients with ongoing active celiac disease, while also considering further potential clinical applications in other gastrointestinal disorders.

Intellectual Property and Regulatory Milestones

Immunic has a robust intellectual property portfolio protecting its lead asset, vidofludimus calcium. In March 2024, the company received a Notice of Allowance from the U.S. Patent and Trademark Office for a patent covering the composition-of-matter of a specific polymorph of vidofludimus calcium and a related method of production. This patent, along with Immunic's eight other patent families protecting vidofludimus calcium, is expected to provide protection into at least 2041 in the United States and 2039 internationally, unless extended further.

Additionally, in April 2024, Immunic announced that data from its Phase 2 EMPhASIS trial of vidofludimus calcium in patients with relapsing-remitting MS has been published in the peer-reviewed journal Neurology® Neuroimmunology & Neuroinflammation. This publication provides further validation of the drug's clinical profile and potential as a unique treatment option for MS patients.

Liquidity

Immunic has raised significant capital to fund its operations, with $430.9 million in net cash raised from private and public offerings of preferred stock, common stock, pre-funded warrants, and tranche rights since its inception. The company's successful $240 million private placement financing in January 2024, led by BVF Partners and including participation from other top-tier investors, has further strengthened its financial position.

As of March 31, 2024, Immunic had $97,312,000 in cash and cash equivalents, which the company expects will fund its operations into the third quarter of 2025. This provides the company with the necessary resources to execute on its clinical development programs, including the anticipated read-out of the Phase 2 CALLIPER trial in progressive MS and the ongoing Phase 3 ENSURE trials in relapsing MS.

Risks and Challenges

Immunic, like many biotechnology companies, faces several risks and challenges in its pursuit of developing and commercializing its product candidates. These include the potential failure of its clinical trials to meet their endpoints, the inability to obtain regulatory approval, and the need for additional funding to complete the development and commercialization of its programs.

The company's reliance on the success of its lead asset, vidofludimus calcium, is also a significant risk, as the failure of this program would have a substantial impact on Immunic's future prospects. Additionally, the competitive landscape in the MS and gastrointestinal disease markets, as well as potential manufacturing and supply chain issues, could pose challenges for the company.

Conclusion

Immunic, Inc. is a promising biotechnology company with a diversified pipeline of innovative therapies targeting chronic inflammatory and autoimmune diseases. The company's lead asset, vidofludimus calcium, has demonstrated encouraging clinical data and is poised to reach several key milestones, including the anticipated read-out of the Phase 2 CALLIPER trial in progressive MS and the ongoing Phase 3 ENSURE program in relapsing MS.

The company's second program, IMU-856, also holds significant potential in the treatment of gastrointestinal disorders, with positive data from a Phase 1b trial in celiac disease. Immunic's strong financial position, robust intellectual property portfolio, and experienced management team position the company well to execute on its strategic priorities and create value for shareholders.

As Immunic continues to advance its clinical pipeline and navigate the regulatory landscape, investors should closely monitor the company's progress and upcoming milestones, which could serve as significant catalysts for the stock.