ELLIS MARTIN REPORT: CARDIOL THERAPEUTICS CEO DAVID ELSLEY:PHASE III MAVERIC - WHAT COMES NEXT $CRDL - CARDIOL THERAPEUTICS INC

Welcome to the Ellis Martin Report and Money Talk Radio. I'm Ellis Martin. Today we're speaking with David Elsley, President and CEO of Cardio Therapeutics. Cardio Therapetics trades on the NASDAQ and the TSX under the symbol CRDL. The company is advancing its lead drug candidate, CardioRx, an investigational oral therapy for inflammatory heart disease, including recurrent pericarditis, a debilitating condition that can cause severe chest pain, shortness of breath, and recurring attacks that may continue for years. Cardiol is now advancing its pivotal Phase 3 Maverick trial, building on encouraging Phase 2 results while also pursuing its Archer program in myocarditis. Today, we'll discuss the progress of the Phase 3 program by Cardiolo Expanded the trial and what this could ultimately mean for patients seeking a new treatment option. David, welcome back to the program. It's great to visit with you today. Thanks for having me back, Ellis. Nice to see you. I'd like to talk about recurrent pericarditis. What does this disease actually feel like for a patient, and why is there still a need for better treatment options, and what is cardio doing to address this? So recurrent pericarditis, this is a very debilitating, miserable condition that impairs quality of life and people really at their prime of life. Typical patient would be 35 to 55 years of age, generally healthy. When for reasons not fully understood, a virus goes to their heart, causes inflammation in the pericardiome, which is the sac around the heart. And this causes a friction, which leads to shortness of breath, chest heaviness, severe chest pain, and these attacks of pericarditis or recurrent pericrditis, they can go on for hours, days, or weeks at a time and patients can suffer relapsing recurring bouts of this pain for many, many years. The challenges with current therapies is they're either poorly tolerated, they have significant toxicity in the case of steroids, or they're immune suppressing in case of the biologics. They have to be injected, they suppress the immune system, they can increase risk for infection. And the case of the biologic, they're prohibitively expensive at $300,000 per patient per year, making accessibility or access to these medicines very difficult. What Cardiol is trying to do, or the goal of our development program is to deliver a more convenient, more gentle therapy for patients. So we're an oral therapy as opposed to an injectable. We're not immune suppressing, so we don't shut down immune surveillance. We don't increase risk of infection. And most importantly, we're potentially disease modifying. So patients won't require our drug for the rest of their life. We'RE not deferring disease or blocking disease. We believe the potential of cardiolar axis to modify the disease so patients can eventually discontinue the use of our drug and go on and live a perfectly normal life. Did we see an uptick of pericarditis during the COVID epidemic? I know we're a couple of years away from it right now, but what have you noticed? I think the pandemic cast a very important spotlight on pericrditis and myocarditis, which are inflammatory cardiac diseases that affect younger people. And whether there is an actual uptick or there is an increased awareness which led to the perception of an uptack? I think the answer to that question will never be known. But importantly, these diseases have been destroying quality of life for thousands of patients for many, many years. And because they're so-called rare disease, they don't get the attention they deserve, yet they take lives unnecessarily. They destroy lives unnecessarily. And I think what the unfortunate pandemic era brought from a positive perspective was it cast a spotlight, importantly, on these conditions, which allows research to be conducted more efficiently, more effectively, because there's more of an awareness that allows the clinical trial execution to be more efficient, more rapid, so drugs can be developed more effectively. Speaking of clinical trials, you are oversubscribed more or less. You decided to expand your Phase 3 Maverick trial to 150 patients after reaching 110 early on. That's exciting, isn't it? It's extremely exciting, and it's being misunderstood as to the reason for that excitement. So when we powered the trial, we were very conservative. In our Phase 2 trial, we showed a 70% reduction in the risk of recurrence or the disease returning or patients getting sick again. That was what we believe was a landmark finding from our phase two program. We use the teachings from that trial to design the maverick pivotal phase three trial to support regulatory approval and to speed our drug to the patients that need it. However, we were very conservative in the powering of that phase three trials. So we would not miss an important treatment effect of our drug. So, we powered it for a 40% reduction as opposed to a 70% reduction, which we thought was too ambitious. However, what we're now observing in the Maverick phase three trial is a lower relapse or lower recurrence rate, fewer patients are getting sick than even we anticipated. And so perhaps what we'RE observing here is a drug effect. So our drug is perhaps potentially being more effective than we anticipated, because we were trying to conservative empowering it and that is leading to fewer patients than we anticipated getting sick in the trial but the trial is still blinded so importantly we do not know how many people in placebo and how many in the active are getting sick however we know that in treatment practice there's been no change in the observed relapse or recurrence rate in patients coming off of immune suppressants. So we expect that is still 75 to 80% of the placebo group is going to get sick during the time course of this trial. So perhaps what we're observing is the reduction in the number of patients having the recurrence of the disease is less than we anticipated in the drug group. That would explain why the event rate or the recurrance rate is lower than we expected. But to ensure that we have the statistical power to definitively answer the question in the eyes of regulators so our drug can become available for patients. We've chosen to modestly increase the size of the trial. We expect it'll take just three more months on a two-year study to essentially ensure, provide insurance that we have the statistical power to underpin a new drug application subject to outcomes from the trial that will see our product available ultimately to patients, the thousands of patients who desperately need a new treatment alternative. I imagine that the Phase II pericarditis results that were published in the Journal of the American Heart Association were instrumental in helping to fill your Phase III Maverick trial ahead of schedule and expand it. And I imagine there's quite a few patients across the country, if not the world, who are saying, when can I get this drug? I mean, this is a thing that many people suffer with. I couldn't agree more. So the Journal the American Hart Association, we were thrilled when they accepted our data for publication. That's a high-impact, prestigious medical journal. That is a key tool to educate the cardiology community so they can educate the patient community about the prospects of this new oral treatment that will be more convenient, more associated with flexible lifestyle, more accessible from a price point of view for reimbursers, and just generally more broadly available because it's an oral medication. medication. It could be dispensed through far more points of care through standard pharmacy distribution channels as opposed to a complex injection regimen where you need specialized training, specialized clinics to support that. We're really developing a medicine for this patient population because this patient population is usually athletic. They're generally healthy when they develop this condition. They want desperately to return to their normal life. Forget about quality of life. They want to just return to normal life. And I think a twice daily oral that doesn't impact their immune system yet gives them the relief and the freedom from the disease that they desperately want. That is what is required. And that is what I believe Cardiol is set up to deliver to the patient community in need. I know that there are always reports of young athletes falling victim to this disease and dying. That's how we hear about it. And naturally, this is a potential solution what are the next steps before it could potentially reach patients so i think the reference you're making there would be more towards myocarditis which unfortunately can be lethal in a younger patient population still but myocARDitis and pericarditis are somewhat related so myocардitis is inflammation of the heart muscle and in our archer program which was a separate global trial our drug we believe is the first to ever show structural improvement in that deadly form of cardiac inflammation that unnecessarily takes young healthy lives. The recurrent pericarditis program is related in that it is also inflammation of the sac around the heart, which is related to the muscle of the heart has similar symptoms is typically thankfully not usually lethal, but destroys quality of life just the same for patients that want a normal life in their prime of life. So the pathway here is to complete the Maverick trial. We couldn't be more excited about the progress that we're making in this pivotal phase three trial.We expect top-line readout in 2027. We then plan to marshal all the necessary resources to put together a new drug application as fast as possible to apply so this medicine becomes available and is accessible to the tens of thousands of patients who we believe don't have good treatment options today. We're talking to investors on this program but naturally there's physicians in our audience. What do you want to say to them right now? To physicians and specialists I would say stay tuned to the Maverick program. I believe this trial is one of the largest if not the largest pivotal phase three trials conducted in recurrent pericarditis. It's being executed at the most preeminent cardiac research centers throughout the United States led by the renowned Mayo and Cleveland clinics that make up the two largest pericardial practices I believe in the world and many other prominent centers throughout throughout the united states and as a company cardiol is committed to moving this through the development pathway as efficiently and fast as possible so it becomes available ultimately to help your patients. David Elsley cardiotherapeutics It's such a pleasure to chat with you again. I look forward to an update in the very near future. Thanks for joining me today on the program. Thanks for having us back, Ellis. We've been speaking with David Elsley, President and CEO of Cardio Therapeutics. The company trains on the NASDAQ and the TSX under the symbol CRDL. That's C-R-D-L. Cardio continues to advance its pivotal Phase III Maverick trial in recurrent pericarditis with top-line results expected in 2027. as the company works toward the potential regulatory pathway for CardioRx. For more information, visit CardioРx.com. I'm Ellis Martin, and you're listening to the Ellis Martin Report and Money Talk Radio.