Lyra Therapeutics: Risk Assessment (NASDAQ:LYRA)

I am Lyra Therapeutics (Nasdaq: Lyra) October Stocks have performed very well over the past few months. There are some important updates from November, a month after my article was written, but not much has been updated. It’s happened since then. Regardless, I think we should take another look at the company and cover these updates while we’re at it.

To quickly recap: LYRA is a small company founded by Bob Langer of MIT to develop a treatment for sinusitis using the XTreo platform. XTreo is a proprietary platform developing biocompatible mesh scaffolds, engineered elastomeric matrices, and versatile polymer-drug complexes that can provide up to six months of continuous treatment to deep tissues in a single non-invasive procedure. They have successfully completed two Phase 2 studies in chronic rhinosinusitis, or CRS, and are expected to generate Phase 3 data early this year. The same was true in January for the second part of the study. Of the two products targeting CRS, LYR-210 is in a phase 3 clinical trial in CRS patients who have not had surgery, and LYR-220 is in a phase 2 study in patients with recurrent disease after surgery. It’s in progress. The difference between the products is that 220 has a larger mesh, primarily for patients whose nostrils have widened due to surgery.

Here’s what I wrote in early June about the “successful” Phase 2 study:

Therefore, although this study did not exactly achieve statistical indicators in the primary endpoint (duration: 4 weeks, measurements – 4CS), it appears to be a successful study with long-term drug effects in patients. The primary endpoint of the Phase 3 ENLIGHTEN study changed from the 7-day average composite score of the 3CS over the 24-week period to CFBL, which was increased over the 4-week period of that phase. 2 studies.

I also noted that the company does not have a material composition patent. This is obvious because of what their products are made of. – Mesh or scaffolding combined with inexpensive generic products. Cheap generics cannot be directly patented, and scaffolding is a completely different matter. Below are details on the types of protection available from the four patents.

Primary lineage – Includes issued patents through 2030 that specify features of implants, delivery systems, methods, and polymers, not limited to specific drugs, delivery sites, or patient conditions.

Secondary lineage – Through 2036, includes issued patents with ENT-specific method claims for specific drugs, sites of delivery (i.e., midstream), and patient conditions.

3D Genealogy – By 2038, recent clinical trials attempt to capture the product’s drug release capabilities and patient outcomes.

4th line – By 2042, towards higher drug load (7500ug).

So 2038 looks like we have a reasonably strong IP base here. I’m still not satisfied, but I think this is the best I can do for this product.

Another issue is that the LYR-210 program does not meet the 4CS primary endpoint. I discussed this in detail in a previous article. The company tried to explain the situation. Their basic explanation includes, first, the argument that, given the inability of these patients to smell adequately, measurements of the 3CS rather than the 4CS should be a more appropriate primary endpoint. So why choose 4CS? The company explains that its product candidate performed very well (i.e., performed statistically significantly) on the 3CS measures. They also noted that the Phase 3 trial will now have the 3CS measurement as the primary endpoint. Finally, they state that the LYR-220 trial also performed well on all 4CS measures while meeting minimum safety endpoints.

Although this claim has no merit, the failure is still serious and could be a point of contention when the FDA reviews the NDA.

Last November, the company announced several news items during its earnings call:

– Additional phase 2 BEACON trial CT scan data demonstrated statistically significant improvement in sinus opacities with LYR-220, with radiological evidence of improvement in patients with chronic rhinosinusitis (CRS’) who had previously undergone ethmoid surgery. provided. –

– New data further supports previously reported positive BEACON topline results demonstrating improvement in CRS symptoms –

– The pivotal LYR-210 Phase 3 trial of ENLIGHTEN I in patients with CRS who did not undergo ethmoid surgery is fully enrolled. Expected topline results for the first half of 2024 –

ENLIGHTEN There isn’t much to say about this except that the research appears to be going well. This data loss is the main catalyst.

finance

LYRA has a market capitalization of $275 million and a cash balance of $130 million. Research and development expenses were $12.4 million for the quarter ended September 30, 2023, and general and administrative expenses were $5.0 million for the quarter ended September 30, 2023. At this rate, the company has cash runway for four to five quarters, or until 2025. Therefore, dilution is expected in the first half of 2024 on a strong note after the company announces positive Phase 3 data.

conclusion

There are problems with LYRA, which I have highlighted here. But the stocks have performed well for me over the past few months, and if they successfully pass the three-stage test, I expect them to perform well again. I will continue to hold it.

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