Radiotherapeutics For CNS Cancers With Plus Therapeutics' Marc Hedrick, M.D.

On this week's episode of the Business of Biotech we speak with Dr. Marc Hedrick, M.D., President and CEO at Plus Therapeutics, about the company's pivot from cell therapy to radiotherapeutics for brain cancers, and what's behind the choice of Rhenium-186 as the radioisotope for its lead development candidate, Reyobiq. We'll talk about Plus Therapeutics' diagnostic subsidiary, CNSide, and hear from Marc about recent FDA meetings and the agency's attitude toward novel radiotherapeutics.      

Access this and hundreds of episodes of the Business of Biotech videocast under the Business of Biotech tab at lifescienceleader.com.  

Subscribe to our monthly Business of Biotech newsletter.

Get in touch with guest and topic suggestions: ben.comer@lifescienceleader.com

Find Ben Comer on LinkedIn: https://www.linkedin.com/in/bencomer/

Transcript

Meet Marc Hedrick, M.D. And Mission

Ben Comer 0:04

Welcome back to the Business of Biotech. I'm your host, Ben Comer, Chief Editor at Life Science Leader, and today I'm speaking with Mark Hedrick, M.D., president and CEO at Plus Therapeutics, a company developing novel radiotherapeutics for difficult to treat cancers such as glioblastoma, which has a median survival of just 12 to 18 months. Mark is a trained general, vascular, and plastic surgeon who worked in academic medicine at UCLA before transitioning into life sciences as a CEO at STEM Source and Cytori Therapeutics. We'll find out what Marc has learned as a biotech leader. We'll discuss Plus's lead candidate, Rhenium-based beta-emitting radiotherapy called Reyobiq. We'll hear about the company's virtual development model and diagnostic subsidiary called CNSide Diagnostics. And I'll get Marc's thoughts on the current radiotherapeutics landscape and investor sentiment. Thank you so much for being here today, Marc.

Marc Hedrick, M.D. 1:06

My pleasure, Ben. Thank you.

Ben Comer 1:08

Let's start out with your background. You were an MD, uh, you trained as a surgeon. Um, what can you say about your time as a practicing surgeon and maybe the work that you did at UCLA?

Marc Hedrick, M.D. 1:22

Yeah, you know, the the thing in my career that really uh was responsible for making the transition from academia into therapeutic development and business was a uh about a three-year stint at University of California, San Francisco, where I worked on a team that was developing therapies for babies still in the womb. And so that these were these were largely um pregnant women who had uh fetuses that had life-threatening conditions, and the survival of the child was kind of universally poor. However, there were there are a group of diseases where if you if one intervenes kind of early in gestation with certain sort of intervention, then you could actually dramatically increase the odds of survival. So that that started me down a path of innovating in uh in medicine and surgery. We developed a number of procedures and and devices and therapeutic approaches as part of that. And that really kind of got me excited and uh finished my career, went on to be on the faculty at UCLA, but continued that uh that interest. And then uh we were early in the uh the stem cell uh could I I would call it sort of the bench to bedside for stem cells in the um the 2000 time frame and then just do a series of circumstances, ended up uh leaving on sabbatical and starting a company, and then uh the next thing you know, I'm kind of doing it full-time.

From Fetal Surgery To Biotech Leadership

Ben Comer 3:09

Well, that with the uh the program that you mentioned at UCSF, um, I imagine there's a diagnostic component to that too, given that it's uh you know, unborn children. Um, was that was it something that, you know, was those diseases that you're talking about, was it something that was regularly diagnosed? Or was it, you know, uh like uh you had a uh a genetic likelihood to have it? Um how how did you know, you know, that uh an unborn baby had a disease like that, I guess, first of all.

Marc Hedrick, M.D. 3:40

Well, at the time, and it's still the case that you're heavily reliant on ultrasound. And uh, you know, things that you could pick up genetically um oftentimes are surgically uh remedial. However, there are a number of um kind of rare but uh anatomic related conditions that are that are fixable with procedures. You just have to do them in a in one of the most, if not the most challenging environment, which is um in the in the maternal abdomen, in the uterus, inside the fetus. And then you have to close everything up on your way out, and then make sure the mom doesn't deliver the baby prematurely. And that's often the difficult part pharmacologically, is to keep the mother from going into preterm labor so that the results of the surgery can have time to take effect over a number of weeks so that the child can actually improve their physiologic condition, so they're survivable postoperative. So it it really touched upon you know a lot of different things um therapeutically, diagnostically, but those were largely sort of dialed in with ultrasound. But then you had to worry about preterm labor. So it cut across a lot of different uh specialties and and treatment concepts.

Ben Comer 4:59

And that was the experience that made you want to get into life sciences. I think it's fair to say, Mark, you're someone who who must like a challenge, given that explanation of that initial project, and then you know what we're gonna talk about uh in terms of uh pluses uh therapeutic candidates. Um, but you you decided to become president and CEO at STEM stores, uh, then went on to Sitory Therapeutics. Uh, could you talk a little bit about um maybe just uh an overview of those two companies and and what you learned about biotech leadership from those experiences?

Why Pivot From Cells To Radiotherapeutics

Marc Hedrick, M.D. 5:40

Well, I think um the there the the opportunities in each of those were sort of a natural progression from academics to small private uh company setting where you're you're you're largely preclinical, uh then kind of moving into uh devices and into a public company and then into uh pharmaceutical public company, um, developing now uh therapeutics and diagnostic for what are the toughest diseases out there that have the poorest outcomes, which are central nervous system cancers. So um I think I I started at the bottom. Uh I mean, I knew nothing from a business perspective. And um and I realized early on as a physician that um I needed to be sort of equivalent to those that had that that weren't MDs, didn't have a scientific background, but had principally a financial background. And so that led me to business school, where I don't know that I learned anything that was particularly overwhelming. Go to medical school, you learn a lot of you know, the world's big, you know, the secrets of um that have you know been been around since you know man's been on the planet. So you learn things that are eternal and interesting and valuable. And then business school is largely math and social science at the end of the day. So there's nothing I kept waiting for the punchline for two years and never got it. But I tell what it did do is it gave me a uh uh gave me the vocabulary of business and it gave me a sense of confidence so that kind of in my career it could be as it sort of evolved. I felt like I sit up sit across some people that had deep financial backgrounds and be able to hold my own. So um I think that was really helpful in terms of of developing. And then, you know, of course, when you're in the field, you're you know, you're rounding out your regulatory experience, your uh your CMC experience, um, you're rounding out your financial uh uh cumen um and then your general management skills. So those all sort of evolved. Um but um but they're yeah, I think really having a business degree was really helpful from because you know this is such a financing intensive business.

Ben Comer 8:06

Yeah, absolutely. Um Sitory Therapeutics changed its name to PLUS Therapeutics in 2019 and changed its focus from cell therapy to to radiotherapeutics. Is that correct?

Marc Hedrick, M.D. 8:22

Yeah, so the SITORY Therapeutics was one of the uh early outlet company leaders in uh regenerative medicine based on a variety of technologies, including stem cell technology, biomaterials, and and so forth. So when I took over, um the task was to uh either show that the uh the cell-related regenerative medicine technology was safe, effective, and financeable. And it's safe, it is it's effective, but it was a very difficult financing environment at that time. And so so the mandate was to accomplish all of those or uh change directions. And so ultimately we divested that technology, uh, which was sort of hard because that's something I spent a lot of time working on developing, but that's the way it goes. And then um, and then we then we pivoted and we pivoted for some very specific reasons. And I'm happy to talk about that if you want to. I'd be interested to hear, yeah. Just sort of lays the background for where where we are today and what we're doing. So um we had a we had sort of a a backbench technology in uh drug encapsulation, specifically liposomal expertise. And we also just from from general knowledge were aware that there was a huge unmet medical need in the central nervous system cancer space. And if you if you look at this, the change in survivals across all different cancers over the last 40 years or so, central nervous system cancers are largely flat. So looking back 40 years, there's been almost no improvement in survivals, where there's been about a 300% improvement in survivals or everything else. So, right there suggests that there's an enormous uh uh opportunity, but but also a challenge. And then just through a happenstance meeting, I was talking to uh who's now a good friend, but a colleague at the time, a neuroncologist, and we were talking about uh solving uh central nervous system cancers as a disease that he generically. And and he was working on a technology with the with the concept that the number, if you look at all central nervous system cancers, the one that the number one thing that works today is radiation. So if you take drugs, radiation, surgery, the thing that gives you the most incremental improvement in survival is radiation. So the but it's very limited in terms of the dose. So really the the concept behind plus therapeutics right now is that there's a huge unmet medical need over the last 40 or 50 years, that radiation is the best current treatment, but it's limited in how much you can give it. So if we can if we can fix that delivery issue and deliver much higher doses, then we think that's a recipe for improving survival. So that was really the basis of the company. And that really um that sort of transition really um began to take hold in 2019. And we've done about five transactions over the last uh that period of time to build out a portfolio of therapeutics and now diagnostics, um, and happy to talk about that, and then ultimately advanced data analytics because we think that to really make a material impact in survival and central nervous system cancers, which is our fundamental goal as a company, that you have to you have to combine all three and resolve all three simultaneously.

Designing Rhenium-186 For The Brain

Ben Comer 12:14

Yeah. Yeah. Well, let's let's talk um first about product development at plus therapeutics. You're developing um Rayobic, which is a Rhenium-186 isotope, uh, for some really challenging cancer indications. I've mentioned uh glioblastoma, but also um leptomenigeal. Leptominid menigeal, say that one for me.

Marc Hedrick, M.D. 12:39

Yeah, leptomining disease. So I'd call it L LM.

Ben Comer 12:43

LM.

Marc Hedrick, M.D. 12:45

Yeah, it yeah, and it's it's metastases to the to the fluid space around the brain, and as opposed to the brain tissue itself. Yeah, exactly.

Ben Comer 12:54

And pediatric brain cancer uh as well as a is an indication um that you're working on. Um can you tell me a little bit about the reasons for selecting those indications? It sounds like, you know, based on what you've said so far, that you uh identified these cancer types, saw that, you know, the kind of massive unmet need, and then went out looking for uh, you know, a product or a platform that could potentially treat those diseases. But maybe I'm I'm getting that wrong. Maybe you went into radiotherapeutics first and and then identified these indications. But what what would you say, I guess, about the the initial selection for Rayobic?

Marc Hedrick, M.D. 13:37

Yeah, so uh I kind of building off what I did mention before, I think we were we were very committed to the radiotherapeutics in the CNS space. And there at the at the time we started looking for opportunities and assets. Really, there weren't a lot of things out there and still aren't. I mean, I think it's this is I think could it could continue to grow and catch hold. But right now, there really wasn't anything out there. And we we found an asset that was Rheobic. Rheobic was designed from the ground up for the CNS syndication. And you mentioned Rhinium as the as the uh the API. Rhenium just happens to have the ideal physics for the central nervous system. And you can't, it's it's you have to say that in context of the delivery modality. So the goal in radiotherapeutics, generally speaking, is to solve for the therapeutic index and max maximize the amount of radiation to the bad tissue and you know minimize the amount of radiation to the uh the normal tissue.

Ben Comer 14:47

To avoid side effects and to avoid side effects, yeah.

Dosing Power Explained

Marc Hedrick, M.D. 14:51

And those are principally around related to the bone marrow, but can be other things as well. So when we saw um well, we saw Rheobic, we recognized that this has a therapeutic index that is maybe 100 to one. Whereas you look at uh patients about companies uh developing alpha emitters, for example, for for patients, you're really kind of talking about two, three, four to one, maybe. So when we when we found the Rheobic opportunity, we recognized that they had real largely solved the therapeutic index issue as it relates to these specific diseases in the CNS. And um, and as sort of a derivative of that, the um the drug was incredibly safe. The high therapeutic index, you really weren't seeing safety uh issues kind of in the in the mid-phase one stage of clinical development. So that gave us a lot of uh confidence that the drug would ultimately be safe at very high doses of radiation. And now, fast forward several years, several years down the road, if you take, for example, a patient that is getting radiation for glioblastoma, uh, and external beam radiation and nuclear radiation are very different, but you could sort of generalize by saying that in uh for glioblastoma, these patients were getting approximately 30 to 50 gray of radiation over the course of their fractionated treatment. We're giving up to 740 gray of radiation. So we're routinely giving over 10 times the amount of radiation in a single dose compared to what can be given, you know, under the best circumstances with external beam radiation. So that just sort of proves the concept that the therapeutic index is very, very high. And uh that that allows you to deliver a lot of punch without really worrying about systemic toxicity. And then now we know it's not even uh really uh uh toxicity around the tumor to the normal brain tissue or normal neurologic tissue. So that's that's really kind of a very unique uh place to be right now because we we we know actually from our phase one trial for glioblastoma that at least we haven't found it, there's no upper limit for how much radiation you can give. And it highly correlates with the improvement in survival. So for every you know, one gray of incremental radiation you can give to the tumor, you get an increasing amount of relative improvement in survival. And we've yet to read them reach a max yet, where we hit uh we've in fact we've yet to reach essentially a maximum therapeutic dose in in two different clinical trials. We've reached sort of a maximum feasible dose, but it the the brain is a very forgiving organ as it relates to radiation, at least in the context of the diseases we're treating.

Ben Comer 18:00

And the reason that you're able to give um such a higher dose of radiation is because it's it's so targeted uh as compared with like a beam radiation where it's it's not, it's hitting, you know, tissue that's not a tumor or or non-cancerous tissue. Is that is that why you're able to raise the dose so much?

Marc Hedrick, M.D. 18:21

Yeah, you know, it's sort of a mix. It's a mix of the drug formulation. Is it so if you think about everything sort of kind of married together, you can't it's hard to it's hard to carve out the independent effects of the radioisotope, the formulation, and the delivery modality. They're all sort of designed, like the drug is sort of ground up for these particular indications. So maybe I'll just take each of those. So rhenium is a beta emitter, so it's different than alpha emitters, but um there's there's a lot of data supporting their utility, particularly around I-131 and you know, thyroid cancer. So a lot of a lot of data showing its its uh its safety and efficacy, but its physics, pathling, uh, energy delivery, it's chemistry, um, its half-life are all very conducive to utility in the central nervous system, uh, for for example. So this to take that it's a face value. This the second thing is that if it is formulated in a way that holds it to the tumor for a long period of time. So in in the um in the central nervous system indications that we treat, essentially the the formulation keeps it in and around the tumor for its entire decay cycle. So that by the time it's burned out, um, it's now no longer hot and it gets metabolized uh through the the general uh systems in the body that break down liposomes and then get treated by the kidney. So you don't get renal damage, you don't get systemic toxicity. So the the formulation is really a critical part of that. And then the third part is the delivery. So the the big issue in the central nervous system, although there's several, but the probably the the biggest of the big is the blood-brain barrier. And it is it can be leaky in cancers, but it's at best, it keeps 98% of drugs out. Right. And um and it's very finicky and uh very difficult to overcome. And and so we have delivery modalities that allow us to go beyond the blood-brain barrier and get directly to the tumor so we can maximize the amount of uh tumor touch time. And um, and so that coupled with the formulation, the physics of the radioisotope and delivery all sort of feed into that ability to get super high therapeutic index.

Ben Comer 21:02

I read that uh Rhenium has a history in medicine and had has, I think, previously been used for uh for bone pain. Um are there other companies that are using this radio isotope uh as the basis of a of a therapeutic? Uh do you know? I apologize for my ignorance. I'm not sure what the answer to that is.

Crossing The Blood-Brain Barrier

Marc Hedrick, M.D. 21:24

There are, and and you're right, there so it's been used commercially for bone mets. Um and uh there's they're different radium radioisotopes, but principally to 186 and 188. And um, and they've been used, and so they they there is some uh beneficial uh utilization in the markets, but we're the first company to really take that to the next level into the and into kind of a broad array of diseases that are both kind of primary metastatic diseases and in uh in the central. Nervous system.

Ben Comer 22:01

Right. And is is Rayobic a trade name? I mean, and I ask because I don't typically see trade names in the development stages, and maybe there's nothing to that, but I I was just curious about you know the naming.

Marc Hedrick, M.D. 22:16

Yeah, no, we're we're at the appropriate stage. I think when you get into late phase two and into phase three, that's in which is where we are. Okay. So yeah, I think we're we're maybe a bit early, but you know, or we were early when we got it, but we're right where we need to be right now. Um and so we'll be um and that trade name is really for the 186 formulation that we use for both primary and metastatic CNS cancer.

Ben Comer 22:46

What does the uh the supply chain and manufacturing look like for Rayabic? Um, and what are the key challenges? Obviously, you know, supply chain is is a big one for radio pharmaceuticals, regardless of isotope. It's uh something that has to be planned out very carefully. Can you give me a sense of of uh of what that looks like, the supply chain and manufacturing?

Marc Hedrick, M.D. 23:10

Yeah, that's an that's another huge benefit of using using rhenium. It really makes the supply chain uh very uh uh scalable and cost effective, uh such that uh we can centralize manufacturing and essentially uh uh supply uh the lower 48 and even some European capital. So I mean going into tertiary markets and and the European and Asian markets, not probably not feasible with a single source manufacturer in the US. But uh the half-life of Rhenium is is 90 hours of Rhenium-186.

Ben Comer 23:52

Umly longer than I think a lot of the other radioisotopes that are being used in therapies, right?

Supply Chain And Half-Life Advantages

Marc Hedrick, M.D. 23:59

Yeah, it's got it's it's got a really it's got a really nice half-life and formulation is such that if you didn't have a deep essentially a depot formulation, um, you couldn't have a 90-hour radioisotope circulating through the blood and expect you know zero toxicity. But because we we formulate the way we do, we keep it on on the tumor for the length of time we do, um that that that path link uh and that uh that half-life is is critical, I think, to the effects size that we're seeing. So um if you think about it like this, you you give a single delivery, and you can uh we it has a gamma emission as well as a beta emission. So we can measure. I mean, say think about this. This is so incredible, really, when you think about it. The rhenium has a beta and a gamma emission. The gamma, the gamma emission allows us to see where the drug is at any point in time. You put the patient in a spec CT scanner. Oh, wow. And you can see, okay, I can I can tell exactly where I can see the the the gamma emission, so I know where the drug is. And then I can also compute within a few days after treatment how much radiation actually got to the tumor. So so every patient is its own trial in a way. So that's what allowed us in phase one to uh to um derive the the relationship I mentioned before that um that you you know for every incremental increase in absorbed dose, you get an incremental improval of survival. So um so it's it's a very powerful development technology just because of the the biology. Um so um so so the the rhenium uh in terms of of of the uh the supply chain has very very good properties from uh uh from the along the parameters I mentioned before. So uh we make the liposomes, they have a long shelf life. Um there are a number of other things. There's a proprietary chelator that allows us to uh control the chemistry, load the the late radio uh the um liposome with the radioisotope. And um and then the it's really the only thing that has a shelf life issue is the rhenium. And we've got about four days or so, but so you can ship it to the hospital. It takes a couple of days to manufacture, ship it to the hospital. You've got two to four days at the hospital. If the patient misses their procedure or their injection or their date too late, you can recalculate the specific activity given. So it provides some flexibility and and also it can go right to uh standard radiologic shipping and receiving, doesn't need to go to the radio pharmacy, which creates, you know, lowers another barrier. Yeah. So really it's the the doctor or the nurse, the the the uh provider orders it generally a week or so before, and then we ship it out. They get it overnight and they give it to the patient.

Ben Comer 27:15

What about the um the source for rhenium? Is it is it coming out of a cyclotron? And like, you know, where where are you actually getting that source material?

Marc Hedrick, M.D. 27:24

Yeah, we use uh we have to use a currently use a tank reactor, and we use MER in Missouri, who's a very large commercial supplier of other tank-related uh radioisotopes. Um theoretically, you can make it in a cyclotron, um, and that's something that we hope to develop over time. But right now, we uh there's no supply constraint at MER. And I think long longer term call in the next year. So, excuse me, over the next year or so, we'd like to have you know full backup supply. We really have backup supply for everything right now except the radiation provider, and we'll be putting that in place as we move towards commercialization.

Ben Comer 28:08

Uh, is is glioblastoma, would you consider that uh a lead indication uh for rheobic um or or or not? I and I guess uh what I want to get to here is I know pediatric brain cancer is one of your indications. I'm curious kind of how where that one is and compared with uh glioblastoma, um, because uh I think that you would be eligible, right, for a rare pediatric disease priority review voucher, potentially, uh, with definitely the pediatric brain cancer, but but maybe uh some of these other um indications. But what is glioblastoma your lead indication?

Lead Indications: GBM And LM

Marc Hedrick, M.D. 28:49

Yeah, it kind of depends on how you define lead. I guess the you know, the way I would define it is what's likely to get approved first. Yeah. And I think in that case, uh our lead indication is probably leptal meningeal cancer. And um while it's if you if it's a horse race, the the glioblastoma started out you know fast out of the gates, but leptal meningeal cancer is caught and will be surpassing it over the next year or so. And um and and so I would def I would say probably their co-leads, kind of in terms they're both in phase two. Um, but I think LN will be the one that's most likely approved first. Um, they both work. I think I have a lot of confidence to say that given the data that we've seen now, uh the Rayobic is safe from both indications and showing uh really promising signs of efficacy in both phase one and in phase two. So we have a lot of confidence that they're you know that uh that data will continue to bear out uh as we move towards uh towards approval. Um so um, but I think that from a commercial perspective, there's no there's a vast difference in the commercial opportunity. So we'll be to put that in perspective for you. So primary brain cancers are extremely rare, and glioblastoma is the the least rare of a very rare group of diseases. So there are about 15,000 patients in the US that develop glioblastoma, and almost all of them recur. If they're true glioblastoma patients, they'll they recur or they're inadequately treated such that uh you know that the resection cavity or the radiation um is only a temporizing measure and it comes back and then they go into a recurrent setting. Once they're in the recurrent setting, the treatment recommendations are essentially clinical trial. Um there's the there's should say that's nothing approved for them, but it's a small number of patients, 15, 15,000 patients a year. For uh leptom meningeal cancer, which there's an epidemic in the U.S. I'm happy to walk you through kind of the dynamics of that epidemic.

Ben Comer 31:11

Yeah, tell me about that.

The LM Epidemic And Survival Gap

Marc Hedrick, M.D. 31:12

But that's uh the the data suggests there are at least 125,000 patients per year in the U.S. that have LM. So call it around 10x, and it's probably two to four times underdiagnosed. So there are about a million patients in the U.S. that are have advanced cancer that are walking around at risk for leptum meningial cancer. And those same patients are also at risk of perenchymal metastatic disease. So so the way, so you there's there's primary brain cancers and there's metastatic brain cancers, and then the metastatic group can really divide it into two groups ones that that uh impact the substance of the brain or spinal cord, which is the parenchyma, and then those that are impact the liquid area and the contiguous area around the liquid space or the cerebral spinal fluid. And there, those are uh you know, order of magnitude more common than primary cancer. So if you look at what's gonna, you know, over the next 10 years, what economically is gonna drive uh the the business of developing drugs for for these patients. I think it's gonna be the metastatic disease. And so why, why, you know, I I mentioned that there's an epidemic. Those aren't my words, those are the the key penny-leading doctors we work with that deal with us every day. And they've seen this really explode over the last few years. And and the the the reason is obvious when you think about it. So there are more and more drugs that are really good at local suppression of very common tumors like breast cancer, lung cancer, melanoma, gastrointestinal cancers, prostate cancers. So while the tumor might be in remission or be held at bay locally, you know, cells can escape. There's still cancer there, but patients can be doing well otherwise. But cells can escape and uh they can get into the central nervous system, even though that's it's a heavily protected environment by design. But a cell gets in there, then that that heavy protection around the brain spinal cord works against you because you're the normal mechanisms that the body uses to clear tumor cells, or the um immunologic mechanisms, or the blood-brain barrier keeping out drugs that wouldn't you know otherwise be beneficial or not useful, really. So once it gets in there, it's it tends to grow quickly and the patient succumbs to the disease relatively quickly. So for leptom meningeal cancer, the median overall survival is kind of in the in the two to four months range. That's even with treatment. Wow. So it's you have a patient that's kind of doing pretty well from their primary tumor, they can develop leptomeningal cancer and can succumb to that very quickly. Um, but on the flip side, you know, we're seeing in our trials patients living many, many months or even a few years with repeated treatments of Rheobic when they're diagnosed early and they're treated. So that sort of uh lays the foundation for you know, why in the world are we in the diagnostic business too? And the reason is that we recognized in our clinical development of RHOBIC for as a therapeutic um for central nervous system cancers, that there were some big challenges diagnostically. In other words, the diagnostics haven't really haven't really in the central nervous system space, haven't really kept up as they have in other non-CNS diseases. So picking up you know rare cells in the blood, um, imaging, or you know, other uh diagnostic techniques can can make an early diagnosis and ongoing assessment of tumor response where that didn't really exist in the central nervous system. So if you take leptom and angial cancer, for example, which is a metastatic cancer of the fluid space around the brain and the lining of that fluid space principally, the way that is currently detected. So this is the standard of care is cytology. And that's a that's a test that uh the first report of that being used was in 1904. So if you think we think about it, you know, going to a hospital, you know, what in the hospital uh started being using, you know, started to be used in the hospital in 1904? There's not a lot. Maybe a reflex hammer or a stethoscope or something like that. I mean, but that's so that's that's really the state of the art. And I mentioned early on that the uh the survivals in brain cancers have been relatively flat over 40 to 50 years. That coincides with the development of MRI. So even MRI, which you know it's it's an unbelievable tool, gives you great insights. It really hasn't really materially moved the survival curve. And so um, and it's it's not doesn't have the greatest sensitivity and specificity for LM. And that's the thing that's really driving the you know the numbers of patients right now in the CNS cancer space.

Ben Comer 36:54

And so this was on your mind, uh, I I suppose when you um thought about the purchase of uh C Inside Diagnostics, which is a diagnostic diagnostic subsidiary to plus therapeutics. I mean, is was that the kind of leading reason for for picking up that business?

Building Diagnostics With CNSide

Marc Hedrick, M.D. 37:15

Yeah, so we so as we began to develop uh as we began to develop rheobic for leptom and angial cancer, we recognized the inadequacy of imaging for studying the disease. So for example, you know, you can always measure survival, but you're looking for biomarkers or interim endpoints that you could look at to show early in clinical development that, you know, hey, is your drug working or not? And so we we recognized early on in planning our trials that that there was a there was a challenge there. So we looked at the universe of biomarker options to evaluate early tumor response, and we found a uh an assay uh it's really a CNS assay platform called C Inside. And it really has four different assays, but one of those assays is a highly uh specific and sensitive test for tumor burden in the fluid around the brain. And that's called that's C Inside is a tumor cell enumeration assay. And you could pick up one cell and call it five cc's of brain fluid. So essentially, if the tumor is there, you're gonna pick it up. Whereas cytology is maybe you'll pick it up 40% of the time. And then if you have to repeat it multiple times in a patient that's really um can crash and burn very quickly, that's a real problem. So we started using this in our clinical trial and then became quickly convinced that it's head and shoulders of anything that is in the market and head and shoulders better than anything that's in development that we were aware of. So we just bird dogged it until we could actually acquire it. And then we ultimately uh acquired it. And by the time we acquired it, it had it had been launched commercially. Uh 11,000 tests have been done commercially and about 200 unique customers and growing in the US or growing about 30% per year with no published data. So we we acquired it, retooled it a bit, uh, published now, getting close to 10 publications, uh, presented clinical trial data showing its utility in 90% of patients with LM. And um and then um have relaunched it. And now we've gained reimbursements for for it. So I think at the end of last year, we were up to about 70 million lives covered in the US for C inside. And so there's a there's a core test, which is this highly sensitive specific tumor cell burden quantitation. That now we we we have we have a lot of data, not not only from us, but from other groups, showing it correlates with survival. So I think at long term, its utility as a surrogate endpoint is is sort of predestined. I think that's going to happen as we you know we move towards validation of that endpoint. Um, it can be used as a surrogate for overall survival. In other words, uh the lower the tumor cell count, the better the patient does. The higher the tumor cell count, the the poorer the prognosis. And so um so it's but it also solves another very important, uh, increasingly well-known problem in metastatic disease of the CNS, which is genetic drift. So the take a breast cancer patient and you assess their HER2 status, which is you know done on every breast cancer patient that gets diagnosed here in the US, the HER2 status in the breast can be different than from when it metastasizes into the brain. So uh so that has pretty significant therapeutic implications. And it can be dynamic, it can be sort of a flux associated with it. And it is one I one culprit and uh the fact that tumors become less responsive to what were thought to be you know highly targeted therapies, therapies based on their you know gene expression patterns. So um so our our test can actually assess uh tumor um gene expression um in um tumor cells that can influence uh drug selection. So it tells you tumor burden can influence treatment decision making. And then also, you know, we do in NGS genomic sequencing to look for specific mutations that are that are common that you know may not so much today, but potentially in the future, could be used more increasingly to make therapeutic decisions. So the diagnostic um can tells you uh when, you know, should do they have the disease and therefore should be treated, and then what to treat them with. And then also you can monitor the patient. So you look at patients over time, you can see response to treatment, stop treatment. Maybe they're seemingly their tumor cells are very, very low or non-existent, tumor comes back, you know to when when to retreat them. So it allows kind of uh being able to personalize the treatment based on the tumor cell response. So we we fell in love with it, acquired it, we're relaunching it. We think it's a multi-billion dollar opportunity and represents a six billion dollar hole in the current global diagnostic market.

Ben Comer 42:46

For that LM diagnostic, would that typically be given to a patient that you know has a a solid tumor that's maybe in remission where there's a they're they're suspecting metastatic disease? Like what is what's the prompt to give that, you know, give that diagnostic?

How Clinicians Use The LM Assay

Marc Hedrick, M.D. 43:04

So I think it will evolve, but today it is it's generally a patient with advanced cancer who has uh clinical symptoms, like a mix of these three things. Neurologic clinical symptoms that are new and rapidly progressing. That can be anywhere in the body. Um, it can be really kind of um uh it can almost be anything that's the but it's a it's an indication that there's left ulminangeal cancer in a particular focal area in the neurologic system. Um they could have MRI findings that are suggestive, not definitive, but suggestive. And they can have a clinical, uh they can have a cytology exam that's uh that can be indeterminate. So even a negative cytology, you can still have, you can still have LM, or they can have indeterminate because cytology is not. Um it gives you sort of a a binary uh outcome and it's frequently wrong. So they would have a mix of those, and then and then doctors could use C inside to make a determination. Okay, I can tell you in one test basically whether you have what you have LM. And in fact, more importantly, somebody that might be in the ER for a constrained neurologic symptom that has advanced cancer, you can tell the patient definitively, hey, you don't have LM, which in many cases is just as important. So it's it so I think that's how it is being used as we're relaunching it. I think increasingly it will be used to monitor therapy and can be used serially over time to assess how the patient's doing with the treatment and their gene expression patterns and whether, you know, what's what is is the drug working or not working? Has it lost the ability for this drug to work or or not? Um you can do that, you know, you can interrogate those patients on a monthly basis. And then, you know, ultimately you take patients that are at super high risk for LM, it could potentially be used. It hasn't, we're not doing it, but it can be used for as a surveillance disease. Now it requires a lumbar puncture. And so it that's a you know, that's uh not not a finger prick. Um but patients that are suspected or have LM all get ports. They get a what's called an Amaya reservoir that's uh like a chemotherapy port that goes into the ventricle, into the two ventricles of the brain. It's just a little uh membrane that goes under the scalp and it gives the doctor two-way access to the fluid of the brain. And uh, you know, when I was a surgical intern, I put these in. I mean, the lowest portion of the totem pole in academic hospitals actually puts these in. I mean, they're pretty really straightforward to put in and very commonly done in any neurosurgical uh operating room in the country. But it allows you to take fluid out at any point in time, at any clinic visit with an alcohol swab and a small needle. And you can you can really uh uh uh get assess fluid you know searely over you know you know multiple time periods. Now, for the flip side of that is that allows us to put drug into the brain. So that's how we target our rheobic drug for leptomingal cancers using that same port. So it's very kind of it the diagnostic is very synergistic with what we're doing therapeutically.

Ben Comer 46:40

That's uh that's really interesting. Um, we are starting to run out of time here, Mark. I'm gonna try to sneak one or two final questions in here. Uh we we moved on and started talking about diagnostics, but I I did want to ask you about Plus's uh virtual development model. And I wonder, I I saw you talking about it um on on the Plus website. And I wonder if you could just, you know, ex explain what that what that is and and how it's used.

Marc Hedrick, M.D. 47:09

So uh yeah, I think when when we pivoted to central nervous system cancers, we were preclinical and we were largely funded with um, and we st we still benefit from about 25 million in grant support right now, but that's winding down as we sort of move into commercialization and late phase uh therapeutic trials. But we we uh we highly leveraged uh consultants, uh a very small footprint, um, outsourcing RD and CMOs, and you know, leveraging um you know telecommunications that really advanced pre-dramatically during COVID to be able to keep keep the keep moving the ball down the field and preserve cash, which is could could be can be very difficult to you know to to raise at times. And so we really leveraged that to the max. And so we're kind of coming out of that. But that was sort of a that was a a stage of our corporate development that were was very it was a very critical model for us at that time. And our board chair was probably one of the early um people in the US, Rick Hawkins, to to leverage that model going back a couple of decades or so. So we really had a nice uh roadmap to follow uh with his his his guidance and expertise.

Ben Comer 48:38

Got it. Um I I also saw that uh that Plus Therapeutics had a type B meeting um about uh Rayobic with the FDA uh in January. And I was just curious, you know, maybe um what what your sense of that meeting was, like maybe what was the outcome and and do do you have a sense of how the agency is thinking about novel radiotherapeutics?

Virtual Development Model Playbook

Marc Hedrick, M.D. 49:05

Yeah, you know, I think um the the meeting went extremely well and uh and the FDA was was very constructive, and uh and I think it's as good of FDA meeting as as as I've ever been involved with. Um I think they've they have really um uh we've over the period of that we started meeting with them on Rey Obic specifically, and that was sort of earlier on in the uh radiotherapeutic uh game that's now you know becoming more common in is in the Renaissance, yeah. Yeah, Renaissance really. Um, I think they were they were getting their sea legs as to particularly around safety. So we were we were pitching 20x the amount of radiation delivered than he could do with external beam, and and that was scary. And um, and so now I think what I see is the the FDA is very sophisticated as it relates to radio farm now, and and recognize you know a lot of the distinctions uh in different uh radiotherapeutic approaches from external beam radiation. And so it we're back to um kind of you know, I think more standard discussions around um you know formulation, pharmacology, uh CMC, uh clinical trial design, uh endpoints, and so forth. And and really this last meeting was really focused around trial design and endpoints. I mean, we're moving very quickly to uh approval trial, particularly for LM. And I think we wanted to be there, there are no approved drugs for LM. There is no well-worn Me Too clinical development model for LM. And so I think we wanted to be uh be very early to the party and move and lockstep with the FDA uh regarding those key issues. And I think we found ourselves, I think, very aligned with the agency coming out of that, particularly around the potential utility of C Inside as a surrogate assay and how we can develop that uh going forward and around what sort of endpoints we would use in a pivotal trial for LN and their openness to look at things beyond overall survival came across very clear in that, which we were very pleased to see because we're treating a compartment. We're not treating a systemic disease, we're treating a compartmental disease. And the FDA was very open to compartmental-based endpoints as part of that.

Ben Comer 51:46

Um, dovetailing on on that and and final question for you, Mark, uh, what are your top priorities for the company uh for the rest of 2026?

Marc Hedrick, M.D. 51:57

Yeah, that's super easy. One is to get to positive contribution margin with our diagnostic uh uh diagnostic that we're launching at Sea Inside. And uh we have some corporate goals, but we think that uh, you know, around 5,000 tests for AM will get to that that business to profitability. Um so we're we're we're very optimistic about the launch, um, but it's early, so it's really hard to forecast. But but we've we've made some made some forecasts that are out there, but I think get that to profitability and grow it as quickly as we can. Very optimistic about that opportunity, and then get Rayo Bec into an approval trial. Um, and that means finish up our GBM phase two trial. Just got a few patients left, and we're pushing to get that uh completed and that data analyzed. Last time we reported data was midway through the phase two, and we showed a 60% improvement in survival over standard of care, and then um and then determine the optimal LM dose and then get that into uh cohort expansion into a pivotal. And I think those are all things we can really make material uh uh uh meaningful uh uh progress on in 2026.

Ben Comer 53:13

Thanks so much for coming on the show, Mark. Uh it's a company taking a big swing, and I I really enjoyed speaking with you.

Marc Hedrick, M.D. 53:20

Thanks, Ben. Appreciate the time.

Ben Comer 53:22

We've been speaking with Mark Hedrick, MD, president and CEO at Plus Therapeutics. I'm Ben Comer, and you've just listened to the Business of Biotech. Find us and subscribe anywhere you listen to podcasts, and be sure to check out our weekly video cast of these conversations every Monday under the Business of Biotech tab at life science leader.com. We'll see you next week, and thanks as always for listening.