Why This Alzheimer's Biotech May Not Live to See 2020
March 6, 2017
By Alex Keown, BioSpace.com Breaking News Staff
NEW YORK – With about $21 million in the bank and a series of business moves that have been scrutinized and criticized, some analysts have posed a serious question: How much longer time Anavex Life Sciences have left?
That’s certainly a question raised by Todd Campbell of the Motley Fool. In a piece published March 5, Campbell predicts the company may not survive past 2020 due to its costs associated with studies of its experimental Alzheimer’s treatment drug, 2-73. Campbell said the $21 million the company has available isn’t enough to conduct the necessary studies to pass any regulatory hurdles. He said the company will need to seek partners to develop the drug or issue more shares or incur debt.
Campbell said the company disclosed in a recent filing that it was looking at partnerships to develop 2-73 and the company has a Phase II/III trial planned. He also noted that Lincoln Park Capital is obligated to buy up to $50 million in Anavex stock per a 2015 deal. As of December, $33,513,928 remained available under the agreement, Campbell said. Despite that availability of funding, Campbell said he has “big questions” regarding long-term financing of Anavex’s 2-73 program.
Unlike other major pharmaceutical companies exploring the buildup of amyloid plaque as the cause of Alzheimer’s, Anavex is focusing on oxidation and nitration in the brain as the driving cause of Alzheimer’s. Anavex 2-73 is an oral treatment being developed to “modify” Alzheimer’s disease, rather than treat it. The drug candidate inhibits oxidation, nitration and cell death by inhibiting the cascade which follows NMDA receptor over-activation.
In September 2016, Anavex forged a deal with Biogen to test 2-73 in an oligodendrocyte precursor cell differentiation assay. That deal followed a July announcement that 2-73 met endpoints through 31 weeks in a Phase IIa trial. The company said “efficacy results demonstrate what appears to be a converging and consistent response for all quantitative endpoints through 31 weeks, including cognitive and functional measures.”
In April 2016, shares of Anavex soared about 23 percent following positive anecdotal responses to the treatment in an Australian trial. Two patients in the trial reported they were able to do things they hadn’t been able to do in some time, including play the piano and paint. However, there were some questions raised about the data. Some of the concerns about the data included the small number of patients in the trial, 32, and a lack of placebo control. That meant that the anecdotal evidence was essentially worthless.
Not only has its clinical data been questioned, Anavex has also been criticized for some of its business decisions. In August 2016, BioSpace reported on what some were calling “lopsided spending”—meaning the company was spending far more money on general and administrative expenses than it was research and development.