Conference Transcript - CRDL 2026-05-19

Brandon Folkes, Analyst — H.C. Wainwright

Good afternoon, everyone, and thanks. Thank you for joining us. My name is Brandon Fokes. I'm one of the English research analysts here at HC Wainwright. Next up, we have a fireside chat with Cardial Therapeutics. And joining me from Cardial is David Elsie, President and CEO, as well as Andrew Hamer. Thank you both for joining me. Thank you for having us. We're starting. The only FDA-approved treatment for recurrent paramedic cardiatis is, next, is Rolunacept. uh it's an injectable biologic uh that acts on the r1 elephant r1 beta trap um you're targeting the nlrp3 inflammasone which is further upstream mechanistically why stopping the primary and assembly of the inflammasone itself a potentially better option than simply mopping up the r1

Andrew Hamer, Analyst — Other

cytokines after they've already been released the um the idea is that if you just mop up the interleukins you completely remove them from the system so you are immune suppressing the patient whereas if you affect the activation and priming and activation of an inflammatory cell you're preventing inappropriate uh releasing of interleukins and therefore you don't immune suppress the patient and so and you have a dose response effect that we've shown with cannabidiol on the activation of inflammatory cells. So you can dampen down inflammation rather than completely remove any inflammatory response, which with interleukin blockers does create immunosuppression. And also we know that weak NLRP3 inflammasome inhibitors such as colchizine are effective in pericarditis. We know from preclinical models that cardiol Rx is effective and therefore an NLRP3 inflammasone inhibitor is exactly what people are looking at for future

Brandon Folkes, Analyst — H.C. Wainwright

treatment. Fantastic. Moving to the Maverick trial, you've surpassed 75% enrollment in that phase three trial. Given the recent expansion to seven U.S. sites, when can we expect an

David Elsie, CEO

announcement regarding the potential completion of enrollment? We anticipate that in the very near future so our primary objective is to read out top line data in q1 of next year we now have a clinical infrastructure approaching 20 preeminent pericarditis disease centers in the u.s making up really the largest in the world we have all three campuses of the mayo cleveland clinic sir and several others so we have every confidence that we have the necessary clinical infrastructure to complete the study but as we mentioned in our recent press release we want to be able to ensure these new centers that are coming on that take several months to ramp up to the extent that they have consented patients and they wish to enroll that we will leave enrollment open to accommodate those centers and a key advantage to the company is that the centers involved in the trial itself typically become the first prescribers of the medicine because they're most familiar with it so we're very encouraged by enrollment rates we've seen as you know we surpassed 75 enrollment so we're in the final leg of the enrollment journey and then look forward to completing the trial and reading out the data that subject outcomes of course but if we replicate the phase two program we fully anticipate this trial will support a new drug application and entry into a marketplace of thousands of patients where we believe our treatment is a more accessible option less aggressive than the immune suppressants and really what patients are looking for because we have to remember this is a time-limited disease so to the extent that this disease runs its course in three to five years patients risk. They want to be trapped on immune suppressants for perhaps longer than that, which can have

Brandon Folkes, Analyst — H.C. Wainwright

untoward side effects. Fantastic. And you mentioned pace of enrollment. Given the good pace of enrollment you've seen, as well as this expansion into some real high-value centers in the U.S., does that give you confidence in the addressable patient population that's perhaps larger than some

David Elsie, CEO

best is assumed? It's possible. Access to new therapeutic options typically identify patient populations that can be larger because often the demographics and what is known about a disease can be limited by access to available treatments. So as soon as you bring a more accessible treatment in terms of its price point, the fact it's oral, the fact that it can be dispensed at more points of care and generally more accessible and you know if you give patients an option to going on biologics or steroids that can often reveal a larger market than is currently outlined in the statistics for example. We've seen some pretty compelling

Brandon Folkes, Analyst — H.C. Wainwright

phase two data you know which elements of the phase two signal give you the most confidence heading into the phase three readouts and then which signals are perhaps less certain or are you less certain or historically have translated um you know not perfectly from phase two to phase three

Andrew Hamer, Analyst — Other

well the primary indication that you're seeking we're seeking and the fda is aligned with is prevention of pericarditis recurrence. So the most important information from the phase two trial was the reduction in events per year that occurred in the patients from on average 5.8 events per year of pericarditis recurrence to 0.9 events per year during the trial involvement. So really that is the key. Very pleasing to see the rapid and sustained reduction in CRP and pain but really for the powering of our phase three trial and the confidence in the phase three trial that was that reduction in events period.

Brandon Folkes, Analyst — H.C. Wainwright

Fantastic. Yeah, and maybe just taking a step back and just walk us through the overview and design of the phase three Mavericks study, inclusion, exclusion criteria, and just some of the key endpoints and what gives you confidence going into these readings.

Andrew Hamer, Analyst — Other

Sure. The main thing to be aware of is that our indication we're seeking and we're aligned with the FDA is prevention of pericardized recurrence. We have simply chosen a population for our phase three trial that is highly enriched for risk of recurrence. And we take those patients and we randomize them to placebo or cardiol Rx, double blind placebo controlled, as you know. And the patients we're choosing are those patients that are planned to trial off their interleukin-1 blocker. They've been on an interleukin-1 blocker for at least a year to be eligible for the trial. They're planning to have a trial off that and we know the placebo arm in that population will have a 75% recurrence rate over the first three months of coming off their interleukin-1 blocker And so we're able to do a trial with a relatively low population number because we believe that we can show a difference pretty easily when you have that high event rate in the placebo arm. And so we follow them for six months. We see what the difference is between the two groups. We've powered it very conservatively based on that marked reduction in events per year that we saw in the pilot trial. and what's important is we know is that the recurrence after you come off an interleukin one blocker is the same as a recurrence if someone has failed culture zine it's the same as a recurrence of someone that's tried to get off corticosteroids so everybody's aligned that this population very homogeneous population to study but will support the whole breadth of an

Brandon Folkes, Analyst — H.C. Wainwright

indication you mentioned that how the trial conservatively can you just elaborate a little bit more on in terms of how the trial is powered statistically the trial is do you want yeah so we

David Elsie, CEO

have a 90 we have a 90 power to show a 40 reduction and to the extent as andrew mentioned to the extent that we replicate our phase two observations which is our hope and what we've design this trial around. That'll be a very well-powered study to provide the data necessary to support progress on the regulatory side in a new drug application. Fantastic. And maybe just

Brandon Folkes, Analyst — H.C. Wainwright

as you think about some data readouts, maybe it's a good time to just touch on your cash runway. Can you just talk about where you are in terms of cash runway? Where does that get us through your intended readouts on your clinical programs?

David Elsie, CEO

So we're fortunate to have a cash runway into Q4 of 2027. And over that time horizon, that supports a number of important developments at Cardiol. So first and foremost, it supports fully the readout and the commencement of a new drug application on the Maverick program. We believe the opportunity for Cardiol RX, our lead drug is similar in size and scope and magnitude to that currently being observed with the anti-IL-1 drugs so they are approaching a billion in revenue we see the opportunity the same or larger because we can intervene earlier in the treatment algorithm and offer a more accessible treatment to a larger number of patients who either aren't sufficiently severe to warrant the more aggressive therapies being deployed or don't want to expose themselves to the risk of being potentially on a long-term immunosuppressant. We also have a very exciting asset within the organization, which is a more efficient treatment schedule. So our oral therapy is a twice daily. We believe that is particularly appropriate for these acute phase diseases, whereas we have a program where we published groundbreaking data in the Journal of the College of Cardiology last year, showing that our once-monthly sub-Q formulation can modify cardiac structure in models of heart failure of many types. And that, as you know, is really an extraordinary market opportunity where mortality rates still exceed 50%. It is the leading cause of hospital admission, and the healthcare expenditures around that are second in terms of impact on health care costs to probably only diabetes. So it's a multi-billion dollar opportunity for the company. It's earlier stage. But importantly, Maverick is the definitive assessment of the molecule that we're developing a sub-Q formulation for. So to the extent that we show in a classic inflammatory cardiac indication being recurrent pericarditis, when you combine that with our Archer data in acute myocarditis, which is, again, the same molecule being delivered on a once-monthly basis, you have this ability to ignite interest in the global heart failure community around the prospects of a new non-immune suppressing drug to target the inflammatory processes

Brandon Folkes, Analyst — H.C. Wainwright

underlying heart failure. Great. And if we assume Maverick reads out as expected and is positive, What are the next development steps as a company you will look to take across CRD38, perhaps, and acute myocarditis or other programs as well? Obviously, we'd move recurrent pericarditis towards approval, potentially from there, hopefully gains approval, I'm sure it'll be a commercial success. where do you look then to move in terms of from a clinical direction just given the good data we've seen across the programs? Well I think we've now shown proof of concept

David Elsie, CEO

in two different inflammatory cardiac diseases and I think that's the really the underappreciated aspect of the cardiol story. So we demonstrated impacts on key features of recurrent pericarditis in a patient population run by the preeminent pericarditis research centers we showed in a large global trial large in terms of myocarditis in 109 patients across 34 centers in five countries that we could influence we believe for the first time ever cardiac structure and now we have this unique opportunity to bring that to bear on not only a maverick our primary focus is on delivering the maverick program supporting a new drug application because we believe that is the fastest path to market for a very effective medicine that deserves to be part of the treatment armamentarium in inflammatory heart disease but the untold story of archer and the opportunities that it points to, and not only heart failure, but other rare cardiac diseases where we have speciality. I think that's really the aspect of the CardioL story that's not being widely appreciated today, and perhaps the surprise for the future. Fantastic. And I do want to come

Brandon Folkes, Analyst — H.C. Wainwright

back to Maverick. You touched on the trial design where patients come off from non-accept. I want of think take a step forward and think about a commercial opportunity here right so um you touched on david sort of using cardio rx ahead of relonacep but when you come to market you also have a you know given the clinical trial you have laid out a path for physicians to switch patients or relonacep onto cardio rx right so how do we think about commercial positioning high LRX when you come to market, just given the broad spectrum, broad opportunity in terms of

David Elsie, CEO

where you could actually go with this drug initially? So I'll let Andrew also speak to, you know, from the cardiologist perspective, but really what Maverick is, is Maverick is modeled after Rhapsody, which was the trial that led to the fast track designation and approval for anti-IL1s. So to the extent that that trial design supported a prevention of recurrence claim, so will Maverick. So given that we're oral, non-immune suppressing, more accessible from a price point of view, we believe payers, patients, prescribers are going to want to trial a more milder therapy prior to going to these aggressive, more potent, either steroid options or immune suppressing options in the case of the biologics and that's what Maverick is designed to underpin and that's why we believe the opportunity is much larger because it can be dispensed at more points of care it can be more accessible from a price point of view and what we know in the patient community is they far prefer an oral treatment to a biologic that needs to be

Andrew Hamer, Analyst — Other

injunctive regularly. And as I was saying earlier, the pathophysiology of recurrence is the same whether you fail colchizine. So that will be the primary place that people will consider cardiolaryx. It's the same if you're trying to come off corticosteroids. But what people are telling us is they want cardiolaryx to replace corticosteroids in the treatment paradigm to become the um the the second line treatment you fail colchicine you can't tolerate colchicine um you would be looking at cardiol Rx and then in the patients that really are very sick yes of course uh rilonosept is an excellent drug and uh and would be used but as we're discussing we're very clearly going to be showing in the phase three trial that you could then come off rilonosept onto cardiol Rx is another point for considering it as your long-term therapy

David Elsie, CEO

So we'd almost see that as a secondary therapeutic option. So to the extent that a patient is unable to taper off of anti-IL-1 or corticosteroids, which they all wish to because of either the side effects, the toxicity, or the risks of immune suppression and infection, we could offer an off-ramp for that patient pool. But we really see that as a secondary, because ideally, we see our drug being positioned for first-line non-responders or those intolerant to first-line regimens, which are non-steroidals and colchicine. And there is thousands of patients that are in that category that aren't sufficiently severe or don't wish to go down the immune-suppressing pathway.

Brandon Folkes, Analyst — H.C. Wainwright

um i do want to just pause it quickly and see if there's any questions in the room otherwise keep going all right fantastic um so maybe just you know sort of staying on maverick students could back you know prior background therapy um number of prior occurrences disease duration what factors could influence events right event rates uh that we should be on board

Andrew Hamer, Analyst — Other

that's a very good question and one of the reasons why this is the perfect homogeneous population because if you go into the broader population of first or second recurrences that have got massively different pathways and and histories prior to that then you have all this complication of you know different subgroups within your population but we're choosing patients that have all ended up on Rilonosept for at least a year. And so by definition, they have had significant problems with pericarditis prior to starting on Rilonosept and therefore are at very high risk of recurrence when they come off it, especially since there seems to be some dependence on Rilonosept as a concern. So we will look at all those subgroups that you're pointing at, but we're finding, and as we predicted, these patients are very homogeneous. So we see them as a single cohort that we can be confident that we're going to get similar results across.

Brandon Folkes, Analyst — H.C. Wainwright

Fantastic. I want to pick up on something. We had a very good discussion this morning on the life sciences market overall, the breakfast discussion panel. And one thing that sort of popped out, which, you know, I think we don't talk about much anymore just because of the stigma, but it's pricing. And a comment that came out was, you know, companies are looking more to price on the higher end of perhaps what they can just given sort of the a lot of moving pieces but including most favored nations right given Goddell Rx is potentially going to be used ahead of Rolandocept and Rolandocept's price you know how do you think about pricing how is your pricing thinking I know we ways away from launch but how is that evolving over time and how does that evolve depending on the data we see You know, if CodileRx is kind of really pulling patients off Rilanicep, keeping them off Rilanicep, why not price opposed to Rilanicep?

David Elsie, CEO

We have had engagement with experts in the pricing area. I can tell you that price is not set, but I can also tell you that the response we receive from payers was very encouraging. And in fact, it was a premium to what we would have anticipated our drug could be priced at. So I can assure you that we've spent many years developing this drug and put significant capital behind the drug development process. So it is important that we price the therapy in a way that we can ensure returns necessary to continue to broaden the therapeutic applications for this interesting molecule, because we believe pericarditis is just the starting point. And we believe that is a very attractive market, a very significant market, as immunosuppressants are demonstrating each and every day. But there are other large cardiomyopathies and heart failure opportunities in the inflammatory cardiac space that we see periconitis as really just a gateway to.

Brandon Folkes, Analyst — H.C. Wainwright

And we're almost out of time, but I do want to ask you one more question along those lines, right? So we had the ARCHER data come out. Can you give us some of your feedback that you've had on the ARCHET data and perhaps the gateway that the ARCHET data, if we get Maverick as well, opens for some of these other potential indications in the future?

Andrew Hamer, Analyst — Other

I think the most important thing is that myocarditis is information of the muscle of the heart. and it's now becoming increasingly clear that heart failure particularly heart failure with preserved ejection fraction we got a thickened heart wall and it can't relax well that is also an inflammatory condition in the in the muscle of that heart with diffuse scarring and so the translatability of the findings of cardiac mri from the archer trial of reduction in both intracellular and extracellular volume, the actual muscle cells and the scarring around them, that really has really got the attention of the heart failure experts as a real potential for looking at CRD38 as a treatment for that huge problem of heart failure preserved ejection fraction or HIF-PEF. Fantastic. David, Andrew, thanks very much. I'm going to end it there,

Brandon Folkes, Analyst — H.C. Wainwright

but appreciate your time. Thank you.