Sareum Restarts Phase 2 Toxicology for Lead Drug, Confirms Financial Runway

Sareum restarts SDC-1801 toxicology: why this step matters for Phase 2

Today’s half-year update from Sareum Holdings (AIM: SAR) centres on one thing retail investors have been waiting for: the restart of the Phase 2-enabling toxicology programme for SDC-1801, the company’s lead TYK2/JAK1 inhibitor for autoimmune diseases with an initial focus on psoriasis.

This follows strong Phase 1 results and clears up October’s interruption, when a 16-week GLP (Good Laboratory Practice) tox study was halted due to unexpected findings that turned out to be more common in control animals that were not dosed with SDC-1801. Subsequent analysis confirmed those findings were unrelated to the drug. That’s an important de-risking moment.

Sareum says dosing in the restarted tox programme is now underway at a leading global CRO, alongside ongoing CMC work (chemistry, manufacturing and controls) and formulation optimisation. The dosing phase is expected to complete in mid-2026, with the full Phase 2-enabling regulatory package targeted by year-end 2026.

SDC-1801: once-daily, oral, and aiming for psoriasis proof-of-concept

SDC-1801 continues to look like a credible contender in a hot TYK2/JAK1 space. Phase 1 in healthy volunteers showed the drug was generally well tolerated, with no serious adverse events attributed to it. Pharmacokinetics (how the body handles a drug) showed a half-life of approximately 17-20 hours, supporting once-daily oral dosing. Pharmacodynamics (how the drug affects the body) demonstrated dose-dependent reductions in relevant cytokine signalling pathways, consistent with selective TYK2/JAK1 inhibition and sustained target engagement.

On formulation, Sareum completed a short pharmacokinetic study to select a suitable vehicle for long-term studies and is close to finalising an optimised capsule designed to improve drug release at higher doses and reduce capsule count in future trials. The full Phase 1 dataset has been submitted to an academic journal and is under peer review – a useful external validation step if accepted.

Why it matters: psoriasis is a large and competitive market (Sareum cites global market value of over US$30 billion), where oral, once-daily options with strong efficacy and clean safety are in demand. Progressing the toxicology package puts the company on a clearer path towards Phase 2 proof-of-concept in psoriasis.

SDC-1802: oncology asset now positioned for partnering

Translational studies for SDC-1802 (another TYK2/JAK1 inhibitor targeting cancer and immuno-oncology) are complete. Sareum reports the strongest validation in haematological cancers such as T-ALL and B-cell lymphoma – areas with significant unmet need and smaller patient groups that suit targeted development strategies.

Management’s conclusion is straightforward: with internal focus on SDC-1801, SDC-1802 will be best progressed by a partner. Preparations to support this route are underway. This is sensible portfolio triage – and it could bring in external funding or milestones if a deal is struck, though terms and timing are not disclosed.

SRA737: improved economics, active IND, and patent extension

SRA737, Sareum’s clinical-stage CHK1 inhibitor, remains in the shop window. The company highlights:

• Licence economics improved: Sareum now secures 63.5% of all future revenues (up from 27.5%) at no cost to the company.
• Clinical backdrop: positive Phase 1/2 signals – good tolerability as monotherapy and promising activity when combined with low-dose gemcitabine in anogenital cancers.
• Regulatory readiness: an active IND (Investigational New Drug application) with the US FDA for a potential Phase 1 trial in AML and MDS, with sufficient capsule stock to run such a study.
• IP strength: Notice of Allowance in the US for a patent covering the crystal form of the drug substance, extending patent protection until at least April 2041.

Business development work is ongoing, supported by a specialist US consultancy engaged to accelerate partnering discussions across SDC-1801 and SRA737.

New frontier: TYK2 neuroscience discovery collaboration

Sareum’s collaboration with Receptor.AI is pushing into neuro-inflammatory indications like multiple sclerosis and Parkinson’s disease, aiming to design TYK2/JAK1 inhibitors that cross the blood-brain barrier (BBB). A first batch of compounds has been designed, synthesised, and run through early biochemical and ADME assays. A second batch is now in synthesis.

It’s early but methodical. Prior internal work on BBB permeability via the SKIL platform gives this programme a technical foundation.

Financials: cash runway confirmed, costs controlled

Sareum finished the half with cash of £2.5 million (31 December 2025), down from £3.5 million at 30 June 2025. The board states that current cash, together with projected receipts, is sufficient for at least one year from approval of these interim results. Core activities – including the SDC-1801 tox programme and the neuroscience collaboration – are being funded from existing cash resources.

Key metric (six months to 31 Dec 2025)	Amount
Cash at period end	£2.5 million
Administrative expenses (incl. R&D)	£1.8 million
R&D spend	£1.4 million
Loss before tax	£1.9 million
R&D tax credits received	£0.1 million
Cash raised via warrant exercises	£0.5 million
Warrant liability (balance sheet)	£1.64 million

Notes: the loss after tax was £1.7 million. A financing charge relating to warrants (£63,000) and a fair value warrant liability (£1.638 million) feature again, so investors should expect some non-cash P&L and balance sheet volatility from this line. Estimated R&D tax credits for the period are £0.2 million, with £0.1 million received in cash during the half.

Timeline and catalysts to watch

• SDC-1801 tox programme: dosing phase expected to complete mid-2026; full Phase 2-enabling package targeted by year-end 2026.
• Formulation work for SDC-1801: capsule optimisation nearing completion, aimed at higher-dose performance and fewer capsules per dose.
• Phase 1 dataset: submitted to a peer-reviewed journal – outcome and publication timing not disclosed.
• Partnering: active discussions for SRA737 and SDC-1801, with a US consultancy assisting; SDC-1802 positioned for a partner-led path.
• Neuroscience discovery: second batch of BBB-penetrant TYK2/JAK1 compounds in synthesis and heading for early assays.

Josh’s take: measured progress, key de-risking, and pragmatic portfolio focus

There’s a lot to like in this update. The toxicology restart for SDC-1801 – after the control-group anomaly was clarified – is the big positive. Combine that with clean Phase 1 signals (once-daily half-life, dose-dependent PD, and no serious drug-related AEs) and Sareum has put its lead asset back on the tracks towards Phase 2 psoriasis proof-of-concept.

Oncology remains a lever for optionality. SRA737’s improved economics (63.5% of future revenues), an active IND, and extended patent coverage to at least April 2041 all support the partnering push. With SDC-1802 now explicitly partner-bound, management is keeping focus where it counts while still nurturing upside elsewhere.

The financial picture is controlled but tight. Cash of £2.5 million and a board-stated runway of at least one year from approval of these results is helpful, yet modest for a company aiming to complete a full Phase 2-enabling package and prepare for clinical expansion. That keeps the case for partnerships – or other funding solutions – very much alive.

Bottom line: this is a steady, confidence-restoring half. The Phase 2-enabling work for SDC-1801 is back in motion, the wider pipeline has credible partnering routes, and the IP position on SRA737 has strengthened. The key near-term watch items are tox execution, formulation completion, and any signs of partnering traction. If those land well, Sareum’s risk-reward tilts more positively.

Further information

Company background and past reports are available at www.sareum.com and www.sareum.co.uk.