Peptide-based bio corporations Caregen on the 1st will disclose the U.S. Food and Drug Administration (FDA) phase 1 clinical trial results for "CG-P5," a candidate treatment for wet age-related macular degeneration (wet AMD). With the release coming about a year later than initially planned and market doubts growing over the company's capabilities, attention is on whether CG-P5 will be shown to be non-inferior or superior to the standard therapy "Eylea." CG-P5 is Caregen's first ophthalmic pipeline, and the results are expected to affect the company's credibility recovery and future fundraising.
Caregen said on the 26th of last month, "Due to the U.S. Thanksgiving holiday, the receipt date for the CG-P5 phase 1 final clinical study report (CSR) has been set for the 28th (local time)," adding, "We will receive the materials on the 29th Korea time and, after internal review, disclose them without delay on Dec. 1."
The CG-P5 phase 1 trial began in July 2023 at six institutions in the United States. The scheduled end date was Dec. 31 last year, but due to difficulties recruiting patients and delays in reading procedures, it was postponed three times to June 30, Oct. 31, and Nov. 30 this year. A Caregen official said, "All subjects were severe patients who had received Eylea injections for a long time, so it was not easy to recruit the eyedrop administration group, which could include a placebo."
As the schedule kept changing, the stock price weakened recently. Caregen's share price fell from 83,200 won on the 25th of last month to an intraday 72,000 won on the 27th, plunging more than 13% in three days. However, when clinical results were announced on the 28th for another pipeline, an oral GLP-1 class weight-loss candidate, the stock rebounded to 87,300 won, up 23.13% from the previous trading day.
◇"Eyedrop 'CG-P5,' similar efficacy to existing injection 'Eylea'"
Macular degeneration is a disease in which abnormalities in the macula, the center of the retina, lead to decreased vision, and the number of patients is rapidly increasing as the elderly population grows. According to the international journal "The Lancet Global Health," the number of age-related macular degeneration (AMD) patients worldwide is expected to reach about 288 million by 2040.
In particular, wet AMD can cause rapid loss of vision, making early treatment important. The current standard treatment for wet AMD is anti-vascular endothelial growth factor (anti-VEGF) injections, and the treat-and-extend (T&E) regimen based on "Eylea" by Regeneron in the United States is widely used. After initial intensive dosing, the injection interval is extended depending on the patient's condition to reduce the burden of hospital visits.
CG-P5 was designed with Eylea as the control arm in phase 1. Typically, phase 1 trials confirm only safety in a small number of patients, so it is unusual that the study directly compared with a commercial competitor to also explore efficacy.
A Caregen official said, "In the process of meeting with the FDA ahead of submitting the investigational new drug application (IND), there were many requests for additional safety verification. The preclinical period was long, so the accumulated data were extensive," adding, "Because the eyedrop formulation is unprecedented, we were advised to also confirm early efficacy."
CG-P5 is a VEGFR-2 (vascular endothelial growth factor receptor) selective binding molecule developed based on Caregen's peptide technology that inhibits the formation of choroidal neovascularization (CNV). It is being developed as an eyedrop, and expectations are that, when used alongside Eylea injection therapy, it will help reduce the number of doses and the duration of treatment.
In January this year, the company disclosed an interim analysis of 24 out of 45 patients in total (about 53%) and said, "There was no significant difference between CG-P5 and Eylea in vision improvement and central retinal thickness (CRT). This can be interpreted as a positive signal that the two drugs have similar effects." The company expects the final results to be similar to the interim analysis.
According to the global market research firm "Research Nester," the global AMD therapeutics market is expected to grow at an average annual rate of 7.5% from $11.6 billion (about 17 trillion won) this year to $24 billion (about 34 trillion won) by 2035. Treatments for wet macular degeneration account for about 80%. Kim Han-jin, an analyst at Lightwood Partners, said, "In the early stages of macular degeneration, patients may see only slight distortion like a Go board bending, so demand for injections is not large, which raises expectations for market penetration of CG-P5 in eyedrop form."
◇Caregen shifts weight from cosmetics to healthcare… distrust over disclosures is a variable
Since its founding in 2001, Caregen has expanded its business from cosmetic raw materials to medical devices, health functional foods, and new drugs based on its peptide platform. Most revenue comes from fillers. Last year, the professional therapy division, which includes fillers, recorded 53.5 billion won in sales, accounting for 64.8% of total sales. The health functional food division posted 12.6 billion won, or 15.32%.
Starting next year, the company plans to shift its weight to the healthcare business. The idea is to accelerate new drug development with revenue from the health functional food business. For CG-P5, the company plans to design a multinational phase 2 trial based on the phase 1 results and apply for Breakthrough Therapy designation from the FDA. It is also preparing to expand indications to dry macular degeneration and to out-license the technology at the end of next year. It is known to be in talks with pharmaceutical companies in Japan, China, Europe, and North America.
If the phase 1 results for CG-P5 are positive and the product approval process proceeds smoothly, Caregen is expected to enter the injection-dominated market and enjoy improvements in both sales and profitability.
On a consolidation basis last year, the company's sales rose 4.3% year over year to 82.6 billion won, but operating profit fell 10.1% to 36.3 billion won. The decline was due to increased research and development (R&D) and marketing expense.
Still, restoring shareholder trust is a task. Caregen has previously been embroiled in controversy over unfaithful disclosures. For reasons including termination of supply contracts and changes in supply amounts, the company was placed under review for designation as an unfaithful disclosing corporation by the Korea Exchange (KRX) a total of 11 times: once in 2019, once in 2020, twice in 2021, twice in 2022, three times in 2023, and twice in 2024.
The issue involved non-binding contracts concluded in 2016–2017, right after its KOSDAQ listing in 2015. Even if a non-binding contract has a nominal size exceeding 1 trillion won, actual sales are determined by the ordering volume of the client. If the client does not order, the contract size can be 0 won. The company now excludes non-binding contracts from disclosure.
A company official said, "We recognize the market's concerns," but added, "Caregen has not conducted a single paid-in capital increase since its 2015 listing. Even during new drug clinical development, we covered costs with profits generated internally, and we have steadily paid dividends since listing," saying, "We will prove our credibility through performance going forward."