Receptive environment for KIN001

Three years after the start of the pandemic investors might be forgiven for thinking that new product approvals for drugs to treat COVID-19 have come to an end. Running against this perception is Kinarus’ lead drug – the oral p38 MAP kinase inhibitor combination – which remains in a Phase 2 study for the treatment of COVID patients.

Moreover, German biotech company InflaRx’s anti-inflammatory drug Gohibic (vilobelimab) was recently approved by the US FDA under an emergency use authorization (EUA) to treat COVID-19 in a limited hospitalised patient population undergoing invasive mechanical ventilation or extracorporeal membrane oxygenation. The EUA was granted despite Gohibic failing a Phase 3 study. Moreover, the FDA has just approved a new anti-inflammatory drug to treat COVID-19 patients: indicating that the era of pandemic preparedness remains as an attractive environment for new drug developments.

Kinarus is currently conducting the Phase 2 KINFAST study in the less severe and mild to moderate ambulatory COVID-19 patients, but unlike Gohibic which is a monoclonal antibody, Kinaris’ KIN001 is an oral drug with a much easier administration and lower cost of goods. In addition, Kinarus has demonstrated that KIN001 has both anti-inflammatory and preclinical antiviral activity against SARS-CoV-2.

Should Kinarus demonstrate efficacy in the KINFAST study, a whole range of discussions would start on a potential EUA for KIN001 in the treatment of COVID-19 patients, where full approval may be contingent on a Phase 3 study, but also raises the profile of KIN001 in another indication – idiopathic pulmonary fibrosis (IPF). Our fair valuation of Kinarus remains at CHF96.0m, or CHF0.09 per share.