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Immuron (ASX:IMC): Interview with CEO Steve Lydeamore
February 28, 2023
We spoke with Immuron CEO Steve Lydeamore about the ongoing clinical work with the company’s foundation Travelan product, and the company’s relationship with the US government, which is interested in Travelan’s use for military personnel.
See transcription below.
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Stuart: Hello, and welcome to “Stocks Down Under.” My name is Stuart Roberts and I’m one of the co-founders of our service. And joining me today, on Friday, the 24th of February 2023, from Melbourne, is Mr. Steve Lydeamore, who’s the CEO of Immuron (ASX:IMC). Steve, good afternoon.
Steve: Good afternoon, Stuart. Thanks for having me.
Stuart: Yeah, so Immuron, as a company, as a guy who’s followed the life sciences sector for a long time, Immuron has had a long development history on ASX. The commonality is the intellectual property platform around bovine colostrum, and if you’ve been around the game a while, you’d come across the flagship product for that, which is Travelan, talk to us about what attracted you to go and join Immuron in the middle of last year.
Steve: Yeah, it was very interesting times and, your viewers will, no doubt, be aware, with the COVID pandemic. I was approached unexpectedly by a recruiter, and I decided, like all opportunities, you should investigate them thoroughly, I went and met with the board and talked to them about what they were looking for, and I decided I liked what I heard.
So it’s a company that had, you know, an area that I was familiar with, in well, like, gut health, or gastrointestinal health. It has cash in the bank and funded, and in current times, that’s obviously, a good thing, and there’s a number of clinical programs, they are underway. But importantly, for me, recently, before that being in a company, I was just into the research, they have a commercial product that you just mentioned, Travelan, on the market, and I thought that would be a good opportunity to put, not only my experience in progressing R&D programs, but also growing commercial brands in the market.
Stuart: Right. So let’s talk about Travelan for a second, for the viewers that haven’t seen that. So, basically, you take the bovine colostrum, you’ve got polyclonal antibodies against a range of bad guys that, when they get into the gastrointestinal tract, can cause traveler’s diarrhea and other worse conditions.
Being able to quickly deal with that means that you can very quickly resolve the symptoms, and the person who’s got the traveler’s diarrhea is up and running faster than usual. Have I summarized the opportunity in Travelan reasonably well?
Steve: You’ve summarized half of it. So, yes, let’s do that. So it is indicated in Australia for relieving diarrhea and allowing people to recover more quickly. The key important difference with Travelan is that through that process of producing polyclonal antibodies in colostrum, which are specific for targeted pathogens, and in the case of Travelan that’s different forms of detects in enterotoxigenic E.coli.
All right, key point of difference is not just relief, but also prevention. But we have a clinical study that was undertaking at work, the auto study that showed up to 90% of people were able to avoid getting traveler’s diarrhea by taking Travelan so that’s the key point of difference. If you’re traveling to Bali, or somewhere like that, where you wanna make sure that you don’t get it, you should take Travelan in advance and while you’re there.
Stuart: And I think sometimes it’s difficult to find it on the shelves, because demand is so strong. People know that Travelan is the thing you should put in your baggage before you fly to Bali.
Steve: Yes, that’s been an unfortunate situation of late, and we did run into a situation where we’re out of stock, unfortunately, because of the rebound and demand during the pandemic. We had a lot of stock and we weren’t selling any of it because people weren’t traveling and stock came to expiry, and ramping up supply chain to be able to keep up with that increase in sales was challenging, and, unfortunately, we did reach a stock-out situation. There has been results, but…
Stuart: You and thousands of other companies around the country, no shame there.
Steve: Yeah, we had one of the bottlenecks now, our supply chain was in the packaging part and you, no doubt, read that there are a lot of products including PVS and listed products that are not, you know, medically necessary. They, obviously, get priority for doing, you know, packaging and Travelan was important for people traveling. Traveling doesn’t really meet that medically necessary criteria. And so we have taken steps to resolve, that all wholesalers and pharmacies are now stocked with our product in Australia, and we’re starting to build stock for growth in international markets.
Stuart: Right. So, that’s the product that’s got this company on the map, but what excites me is what comes next. You’re currently got an open I&D where you’re gonna seek to take Travelan and get it approved under a biologic license application. In plain English, we wanna be able to get this approved as a medical grade product for the US market and beyond.
Steve: Yeah. So, for those that aren’t aware of the BLA acronym, that’s the Biologics License Application. That’s the FDA term for a prescription biological drug. And, yes, we’re moving forward with the clinical program to get that status. That would mean that it’d be prescribed by doctors, be reimbursed by health insurance and the like, and be widely available to everybody.
We did receive approval from the FDA late last year for an I&D, that’s the investigation on a new drug, currently, going through the ethics approval procedure with a view to starting a Phase II clinical trial in this first half of the coming year.
Stuart: That’s great. Now, on top of that, you’ve got one clinical trial that’s on what they call “clinical hold” at the moment. You wanna show that the product is useful going after that bug you mentioned earlier, ETEC, or not some bug, it’s toxin, and yet you were put on clinical hold. You are now working with the agency to get it off clinical hold, talk to us about what happened there and what you expect will be a favorable outcome.
Steve: Yeah. So, Travelan active is IMM-124E, which is ETEC, or enterotoxigenic E. coli. It’s a different product, so it does have ETEC as one of the targets but the other target is campylobacter. So it has a different proprietary animal vaccine that was developed, but producing a different bovine colostrum product. Unexpectedly, the FDA found that, because it’s a different bovine colostrum product, they wanted additional safety data over and above what we had.
So we have recently completed a toxicology study in animals and answered a number of their questions, and we’re hopeful that in March we should get, well, I’m hoping anyway, a positive response from them, allowing us to go ahead with the trial. This is a program that’s funded by the US military, the Department of Defense, and we’re collaborating with the Naval Medical Research Center in this program.
Stuart: Yes. And that’s another interesting aspect of this. Uncle Sam is very interested in your product, because he deploys troops all around the world, often to zones where soldiers will be exposed to pathogens that could cause diarrhea, thereby hindering the fighting capability of those soldiers. You’ve, potentially, got a solution for him, and so you’ve been collaborating with the Armed Forces University to get that up to the standards that he would need.
Steve: That’s true. So, the US Department of Defense is very interested. They’ve spent quite a bit of money with our company, proving the capability of our technology. So, even for Travelan, like, they’ve done studies showing that it has broad spectrum antibiotic activity on about 180 different pathogens.
The Walter Reed Army Institute did some studies on shigella. Now we’re working with the Naval Medical Research Center on campylobacter and ETEC, but the study you just mentioned is that Uniformed Services University, another part of the US military that’s running a field study with our current over-the-counter Travelan product, the placebo-controlled trial in 868 patients, with actively deployed military from both US and in the UK, actually, so the UK military is involved in this one as well.
So they’re all very interested, and for a good reason. You don’t really want troops that are not able to actively be in service because of something like traveler’s diarrhea.
Stuart: Right. So, we’ve got, at least, one clinical trial, hopefully, getting started next year, another one current coming off clinical hold, and one active with the Armed Forces University at the moment. So you’re at a Phase II opportunity, and yet when I look at the market cap of this company it’s only $17 million on ASX at the moment. So it’s fair to say that the market is not giving you much love at the present time.
Steve: No, it’s not. In fact, our market cap at the moment is below our cash balance. That was one of the reasons that attracted me to the company. I thought, you know, “Here are these assets.” And, admittedly, coming into an organization, you get to do some due diligence, but not as much as you would like. Once you’re inside, you get more information.
And once I’ve come inside, I’ve been even more impressed with the opportunities. I think there’s value that I can add, and, certainly, the technology has much greater value than what the shareholders are currently ascribing to it.
Stuart: Right. And I’ll add in a few more items of value. Look at the published literature on your technology, on the immuron.com website, there’s a long history of pretty serious development of these products that make them valuable from a scientific perspective, right?
Steve: Absolutely. And I think when the general stock market turns and people get the opportunity to…you know, that risk appetite opens up a bit, they’ll see that there’s a great opportunity for the technology that we have and deploying it in the right reasons against the programs we have.
So, one of the first things I undertook when I joined Immuron was to contract with a preeminent consulting organization in the US called Humanity to a market evaluation to make sure that…you know, there has been a delay in some of the programs during COVID, to make sure the opportunity is still there.
So for the IMM-124E for traveler’s diarrhea, the BLA that we talked about before, is that market opportunity still there? IMM-529 for Clostridioides difficile, is the market opportunity still there? And fortunately, they came back and said, “Absolutely, the market opportunity is there.”
They valued that, not the share but with the market. So, we know there’s a market, we know we have a technology that works, we just need to get moving forward, deploying the cash that we currently have, do the clinical programs necessary to get it to market.
Stuart: Yes. Now, Steve, you and I have known each other for a number of years. One thing that’s very impressive about your resume’s the companies you’ve worked for, you know, you grew up in, I call it, the Faulding School of Hard Knocks, F.H. Faulding the Adelaide-based pharma company run by the legendary Ed Tweddell, generated a whole legion of pretty talented biotech executives, including yourself, including Jackie Fairley at Starpharma, etc.
You jumped from there over to the US and ultimately ended up in Canada working for Apotex, and for those of us who know generic drugs, Apotex was was one of the guns in this space, and you were, I think, the number three or number four man in the organization.
Steve: Yeah, that’s true. And I looked after all countries outside of US and Canada, one of which was Australia. So Apotex in Australia is now Arrotex, and it’s the largest, you know, generic company by some measures in Australia, perhaps, Milian, the actress, is up there as well. But I’ve worked in not only Australia, but also the US and Canada and responsible for 111 country markets around the world, both generic product drugs and biologics.
Stuart: Right. So, Steve, I’m gonna make you an offer you can’t refuse, I’ll write a check for $18 million, and I’ll buy the company and you can come and work for me. I take it you’re gonna knock that off the back, right?
Steve: I certainly will, so, you know, thanks, Stuart.
Stuart: All right. So, we can both agree that Immuron, given the potential, is worth a lot more than the current market cap and viewers oughta, you know, do their homework on what could be a very interesting couple of years for your company.
Steve. Yes, I think we can agree on that, Stuart.
Stuart: All right. Steve Lydeamore, thanks for talking to “Stocks Down Under” and good luck in terms of your clinical, and other development in 2023.
Steve: Very good. Thank you.