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Jerrydylan, Here's one of Lilly's recent SFN presentation abstracts. For several years, Lilly has been publishing papers on their stellar results in animal models of Parkinson's. According to Lilly, their AMPA upmodulators produced better results in these animal PD models than did any other pharmacological intervention previously tried. If you look on PubMed there are numerous other Lilly papers on the subject.
I'm surprised that we haven't seen Lilly starting a human Parkinson's trial yet with one of their compounds. They might conceivably be having continued excitotoxicity problems however - their AD Phase 2 trial was stopped several years ago reportedly due to excitotox related problems. Dr. Rogers discussed Lilly's compounds at a past SHM, and it sounded like the tendency toward excitotoxicity is probably a class wide effect with Lilly's biarylpropylsulfonamides. LY-451395 for example (the compound in the AD trial that was stopped), had an extremely narrow therapeutic index, hitting MTD very suddenly at doses only modestly above its therapeutic dose. At the SHM presentation, Dr. Rogers said gravely that with Lilly's compounds, you WILL get seizures -
>>> Program#/Poster#: 76.18/HH25
Title: The ampa receptor potentiator LY450108 helps regenerate the damaged nigrostriatal pathway: mechanistic studies in the 6-OHDA model of Parkinson’s disease
Location: Georgia World Congress Center: Halls B3-B5
Presentation Start/End Time: Saturday, Oct 14, 2006, 2:00 PM - 3:00 PM
Authors: *M. J. MESSENGER1, T. K. MURRAY2, W. A. MARK2, M. J. O'NEILL2;
1Eli Lilly & Co. Ltd, London, UNITED KINGDOM, 2Neurodegeneration, Eli Lilly & Co. Ltd, London, UNITED KINGDOM.
Current treatments for Parkinson’s disease (PD) relieve the symptoms of the disorder but have no effect on disease progression. Neurotrophic factors have been used as a neurorestorative treatment in PD to induce neurite outgrowth and synaptogenesis to repair the nigrostriatal tract. We have discovered a series of AMPA receptor potentiators (LY404187, LY450108, LY503430), that increase BDNF in vitro. Since BDNF can protect against neurotoxin-induced lesions of the nigrostriatal system we hypothesized that these compounds could act as a neurotrophic treatment for PD.
In the present studies we investigated the neurotrophic potential of the AMPA receptor potentiator, LY450108, after a severe 6-OHDA lesion of the nigrostriatal pathway in rats. Chronic treatment with LY450108 (0.1 and 0.5 mg/kg p.o.) produced a robust improvement in apomorphine-induced rotational behaviour and tyrosine hydroxylase immunoreactivity in the striatum, but had no effect on the number of cells in the substantia nigra. To gain insight into the mechanism of action, we carried out time-course studies (1, 3, 8 and 15 days) to evaluate the effect of LY450108 on [3H]-Mazindol ligand-binding and mRNA expression for a range of trophic factors (BDNF, NGF, NT-3), RGS2 and GAP-43 by in situ hybridization. A large increase in [3H]-Mazindol ligand-binding in the striatum and an increase in GAP43 expression in the substantia nigra occurred between eight and fifteen days following 6-OHDA in LY450108-treated rats. We also observed a transient increase in RGS2 mRNA in the striatum from two to fifteen days post-lesion. In contrast, no increase in BDNF, NGF or NT-3 gene expression was detected in the nigrostriatal pathway.
LY450108 appears to have neurotrophic properties, increasing dopaminergic innervation of striatal terminals and improving functional outcome. Modulation of AMPA receptors may provide a means of both halting the progression and perhaps reversing the degeneration in PD. <<<
Neuro, I'm not sure how we can reasonably expect the results to be significantly different this time around. For the primates, the doses will be even higher than what produced the histo finding in the original study. The only hope is that if there are more dose levels used, one could establish a more accurate level at which the histo finding begins to occur. The other hope, that a different method of tissue preparation/fixation/visualization might not show the histo finding to the same extent as before, sounds pretty flimsy to me.
Another factor would be if Cortex can start to understand what is going on on a cellular level and why, perhaps the mysterious/unknown aspect of the problem would be lessened and the FDA might loosen up the dosing restrictions. Cortex is also doing studies of the possible role that CX-717's metabolites might play, though I don't know when these might be completed. Electron microsopic studies of the affected cells are also reportedly being done.
FWIW, even with a modest dose liberalization by the FDA, I'm not expecting CX-717 to be able to realistically go ahead for ADHD. The impression one gets from Stoll's recent presentation is that they aren't even close to the dose they think they need for ADHD. If so, the best we might be able to get is a CX-717 BP deal for Alzheimer's, which at least would be something.
Money4, "IF correct, were the two doses that showed no problem not high enough to give the fda the margin of safety they felt comfortable with to allow cortex to continue using the adhd trial dose???
OR
did the fda restrict the dosing, even though at lease one of the two test doses that didn't show a problem and was high enough to give the fda the safety margin they felt comfortable with, but for which they need repeat testing to confirm the results?
OR
none of the above. ???"
The FDA must not feel comfortable with the margin of safety. They may be setting the margin higher than usual due to the somewhat mysterious/unknown nature of the histo finding.
FWIW, in the recent conf call, Dr. Stoll seemed to be hanging our hopes mainly on the fact that they're using a different method of tissue preparation/fixation/visualization this time around.
A link to the full text -
http://www.jneurosci.org/cgi/content/full/25/39/9027
Note that Dr. Rogers discussed this paper at an annual SHM, in part to explain why Lilly's problems with LY-451395 (its AD Phase 2 had been stopped) shouldn't have any bearing on CX-717's prospects.
While that may be true when it comes to excitotoxicity (which has always been the long standing theoretical knock against the AMPA upmodulation concept), if calpain activation turns out to be an additional problem (IF), the fact that CX-717 and CX-614 act at different binding sites may not matter. The key factor may instead be that both CX-717 and CX-614 act primarily via the mechanism of inhibiting receptor deactivation (as opposed to desensitization). Only time will tell, but this mystery with the CX-717 histo finding has become extremely interesting, at least from a scientific point of view.
More on the deactivation vrs desensitization topic, if anyone is interested. This is an excerpt from the 2005 paper that studied the high impact site on the AMPA receptor, and found that CX-614, cyclothiazide, and aniracetam all bind at this "high impact" site (CX-717 binds at a different site). But as we now know, in spite of binding at the same site, CX-614 activates calpain activity and cyclothiazide (CTZ) doesn't. The key difference as it relates to calpain activation might instead be in their different mechanism of action (CX-614's primarily being deactivation related, and cyclothiazide's being primarily via desensitization). Also, note that benzothiadiazides (Servier's S-18986) and biarylpropylsulfonamides (Lilly's compounds) are structurally related to cyclothiazide -
>>> Modulation of deactivation
Deactivation is the process by which the ion-conducting pore of glutamate receptors closes, allowing agonist to dissociate from the ligand-binding "clamshell." Deactivation is measured experimentally by exposing the receptor to such brief (1 ms) pulses of agonist that little receptor desensitization can occur. Desensitization is a long-lasting, agonist-bound, nonconducting state; it is measured experimentally by exposing the receptor to a prolonged (500 ms) pulse of agonist. CTZ prevents normal channel desensitization, the rearrangement of a dimer interface formed by adjacent subunits within a receptor complex that allows the ion-conducting pore to close in the continued presence of agonist (Sun et al., 2002). CTZ modulates desensitization to a far greater extent than it does deactivation, and it is more efficacious on flip isoforms. Unlike CTZ, aniracetam and CX614 slow channel deactivation (Fig. 1) and are selective for flop rather than flip splice isoforms. Modulators of deactivation can have little (aniracetam) or marked (CX614) additional effects on desensitization. <<<
Looks like Cortex is still on the Berlin exchange. One would think that Dr. Stoll may have tried to get the stock off that exchange. Other companies have apparently gotten themselves removed from there. The Berlin exchange is reportedly where naked shorting can be done more easily.
On the other hand, perhaps if a stock isn't traded there, then the PIPE financiers might be less eager to do financing deals with that company(?) In that case it would make sense for a small bio company to reluctantly stay on that exchange, in spite of the increased potential for manipulation.
Dew, board, While Dr. Cox couldn't yet provide sales/revenue estimates for Atryn in the recent conf call, I was wondering if you guys have any ballpark guestimates? Also, any estimates on the approx timeline for Atryn's approval in the US, assuming all goes well clinically? Thanks.
As discussed in the Lynch paper excerpt below, it's not clear yet why some Ampakines activate calpain activity while others don't. We were previously under the impression that this was a high impact phenomenon, but the observation that cyclothiazide and CX-546 don't activate calpain activity, while CX-614 does, indicates that there is likely more involved than just high impact vrs low impact. As the Lynch paper says, more calpain related research needs to be done on additional Ampakine compounds. Also, these studies were done using hippocampal brain slices for a maximum of 48 hours. In live animals, mega-dosed for up to 3 months, the cellular effects could be far different. Bottom line is that when it comes to AMPA upmodulation, we are still in uncharted waters -
>>> Interestingly, different classes of positive AMPA receptor modulators produced divergent effects on calpain activation. In particular, both cyclothiazide and CX546 did not activate calpain; if anything, CX546 produced a decrease in basal level of activation as evidenced by lower levels of SBDP as compared to control. Positive AMPA receptor modulators have been shown to affect AMPA receptor function through different mechanisms, with some modulators interfering with desensitization kinetics of the receptors, while others affect rates of channel opening or closing (Arai et al., 2002b). For instance, CX614 and CX546 mainly decreased the rate of deactivation of the receptor, thus prolonging the duration of AMPA receptor-mediated synaptic responses. On the other hand, cyclothiazide affects primarily desensitization kinetics, and has been shown to have little effect on AMPA receptor-mediated synaptic transmission. Our results would therefore imply that positive AMPA receptor modulators with similar effects on AMPA receptor kinetics are able to have opposite effects on calpain activation. As an antagonist of AMPA receptors completely blocked CX614-induced calpain activation, our results also indicate that AMPA receptor stimulation is necessary for ampakine-elicited calpain activation. The reasons for the decrease in calpain activation elicited by CX546 are not clear at the moment, but might be related to differential effects of various ampakines on pyramidal neurons versus inhibitory interneurons. Testing the effects of additional ampakines should provide interesting information regarding these interpretations. <<<
I should add that calpain activity is also thought to be associated with normal LTP (long term potentiation - the basis of memory formation), so it's unclear whether CX-614's activation of calpain activity is something to worry about or not. But since it's one of the few Ampakine effects we know about which could potentially cause cellular related problems (the other being excitotoxicity), it's something we need to at least consider as a possible cause of our histopathology finding.
Calpain mediates cell death and is associated with stroke, traumatic brain injury, and heart attack (does not induce these events but is associated with their cellular aftermath - the post-event cellular destruction). We know that some Ampakines like CX-614 activate calpain activity, at least in hippocampal tissue slice studies -
>>> Inhibition of calpain-mediated cell death by a novel peptide inhibitor.McCollum AT, Jafarifar F, Lynn BC, Agu RU, Stinchcomb AL, Wang S, Chen Q, Guttmann RP.
Department of Biology, Florida A and M University, Tallahassee, FL USA.
Calpains are calcium- and thiol-dependent proteases whose overactivation and degradation of various substrates have been implicated in a number of diseases and conditions such as cardiovascular dysfunction and ischemic stroke. With increasing evidence for calpain's role in cellular damage, the development of calpain inhibitors continues to be an important objective. Previously, we identified a highly specific calcium-dependent, calpain interacting peptide L-S-E-A-L, that showed homology to domains A and C of the only known endogenous inhibitor of calpains, calpastatin. This suggested that LSEAL had a calpain inhibitory function and synthetic LSEAL inhibited calpain I and II proteolysis of two calpain substrates, tau and alpha-synuclein. In the present study, we demonstrate that synthetic LSEAL is membrane permeable and is a potent inhibitor in two established models of calpain-mediated cell death using primary rat cortical neurons and SH-SY5Y neuroblastoma cells. In addition, we show that LSEAL inhibits calpain activity towards protein substrates as detected by an antibody to a calpain-specific breakdown product of spectrin. Taken together, these results suggest that LSEAL may represent a novel calpastatin mimetic with the potential for benefit in conditions of increased calpain activity such as stroke, traumatic brain injury or heart attack. <<<
Dew, Sepsis has always been a graveyard for pharma development. I wonder if reliance on this program is one of the reasons for GTCB's overall weakness?
OT - Dew, Concerning GTCB, once tax selling season is over, just wondering if you see any near term drivers for the stock in 2007, or are you basically thinking of GTCB as a long term buy + hold type opportunity? Also, you hold it in the investment fund you manage, but I assume you also own the stock yourself? Thanks.
I'm not sure anyone knows what the heck is going on yet. We investors don't even know what the affected organ is (brain/CNS, liver, kidney, etc), so we're pretty much groping in the dark. The calpain effect is the only cellular type side effect of Ampakines that I've heard about that's has been published, though whether it is the culprit behind our cellular changes is anyone's guess. It would fit in with the mysterious aspect of the histo finding (never having been seen before). The calpain papers say the effect in hippocampal slices was partially reversible, was apparent after longer dosing periods, and at higher doses, all which fit the description of the histo finding, though these characteristics would also fit with many other possible causes.
One thing that particularly caught my eye in the Lynch paper though was the prospect that an Ampakine which acts primarily via the deactivation mechanism can activate calpain activity. That would change my long standing assumption that the calpain/spectrin problem was limited to high impacts only.
OT - If anyone's interested in GTCB, they have a conf call at 10:00 AM EST today. They're an interesting company (transgenics) which got considerably more interesting after their recent approval in Europe (the world's first approved transgenically derived drug for use in humans). The company is still limping along financially, and will take years to gradually build itself up, but they've made it past perhaps their biggest hurdle by getting that approval. Dew follows them (and owns about HALF the company!) Just kidding, but he does apparently have a large position.
This older paper may provide a clue (in that there are 2 distinct mechanisms of action within Cortex's own benzamide class of Ampakines). But the issue is further complicated by the observation that the 2 mechanisms overlap, with compounds having characteristics of both mechanism in varying degrees, depending on the particular compound -
http://jpet.aspetjournals.org/cgi/content/full/303/3/1075
An excerpt from the Lynch calpain/spectrin paper discussing the different mechanisms of various Ampakines (the inhibition of receptor desensitization vrs the inhibition of receptor deactivation), and the potential link this may have to calpain activation. The issue is further complicated by the observation that if CX-614 and CX-546 both act primarily via the deactivation mechanism, why is their ability to activate calpain activity so different? It appears that researchers are far from fully understanding the significance of the calpain/spectrin phenomenon as it relates to Ampakines -
>>> Interestingly, different classes of positive AMPA receptor modulators produced divergent effects on calpain activation. In particular, both cyclothiazide and CX546 did not activate calpain; if anything, CX546 produced a decrease in basal level of activation as evidenced by lower levels of SBDP as compared to control. Positive AMPA receptor modulators have been shown to affect AMPA receptor function through different mechanisms, with some modulators interfering with desensitization kinetics of the receptors, while others affect rates of channel opening or closing (Arai et al., 2002b). For instance, CX614 and CX546 mainly decreased the rate of deactivation of the receptor, thus prolonging the duration of AMPA receptor-mediated synaptic responses. On the other hand, cyclothiazide affects primarily desensitization kinetics, and has been shown to have little effect on AMPA receptor-mediated synaptic transmission. Our results would therefore imply that positive AMPA receptor modulators with similar effects on AMPA receptor kinetics are able to have opposite effects on calpain activation. As an antagonist of AMPA receptors completely blocked CX614-induced calpain activation, our results also indicate that AMPA receptor stimulation is necessary for ampakine-elicited calpain activation. The reasons for the decrease in calpain activation elicited by CX546 are not clear at the moment, but might be related to differential effects of various ampakines on pyramidal neurons versus inhibitory interneurons. Testing the effects of additional ampakines should provide interesting information regarding these interpretations. <<<
OT - Gee, I think I'll raise a cool billion. It's amazing the glorious opportunities that a high stock price can bring. BTW, in addition to their blockbuster Revlimid for cancer (Thalidomide), Celgene has the Ritalin/Focalin ADHD franchise. Wonder if they might be interested in a little California company with a great new ADHD drug. We can always hope -
>>> Celgene to issue up to 20 million shares
CELG 52.89, -0.55, -1.0%) said late Wednesday that, as a result of its expected inclusion in the S&P 500 index, the company plans to issue up to roughly 20 million shares of its common stock. The Summit, N.J.-based biopharmaceutical company said the purpose of the offering is to partially meet the expected demand of index funds to purchase its stock when the company is added to the S&P 500, which is expected to happen at the close of trading Friday. Celgene plans to use proceeds from the offering for general corporate purposes. <<<
After reading the full text the Lynch paper, I don't know what to think -
>>> One of the preferred calpain substrates in brain is brain spectrin; brain spectrin, initially referred to as fodrin, is a prominent component of the membrane-associated cytoskeleton. Substantial evidence implicates spectrin in the regulation of cellular morphology in red blood cells and muscle sarcomeres, and in the clustering of acetylcholine receptors at neuromuscular junctions <<<
I just hope that Dr. Stoll's sudden zeal for the non-Ampakine in-license strategy around a year ago wasn't related to the info published in these papers last year. Probably not, but with my paranoid nature, I wonder.
It turns out that this calpain activation is not a purely high impact vrs low impact phenomenon. While CX-614 is a high impact that activates calpain activity, CX-546 and Cyclothiazide (also on the high impact side of the spectrum) don't activate calpain. The correlation with calpain activity appears to be more related to the particular Ampakine's mode of action - whether it acts primarily by inhibiting receptor desensitization or by inhibiting receptor deactivation (according to this theory - if by deactivation then it activates calpain, if by desensitization then it doesn't activate calpain). This is totally opposite of what I would have expected. The bombshell is that many low impacts apparently act primarily by inhibiting - DEACTIVATION (hence their stellar safely profiles when it comes to excitotoxicity, though perhaps not when it comes to the calpain/spectrin question).
Some backround - Cyclothiazide related Ampakines (Servier's benzothiadiazide S-18986 and Lilly's biarylpropylsulfonamides), act primarily on receptor desensitization (and thus have a tendency toward excitotoxicity). But importantly, it looks like they don't activate Calpain (or not strongly). Many of Cortex's benzamides, on the other hand, act more by inhibiting deactivation (thus having much less tendency toward excitotoxicity). But, and here's the rub, because of their deactivation mechanism, they may tend to activate Calpain activity more strongly! Of course this assumes that the desensitization vrs deactivation theory mentioned in the Lynch paper is correct. I doubt that anyone knows that for sure yet.
While they point out in these papers that the calpain activity apparently wasn't associated with cellular damage, these tissue slice experiments were only done for up to 48 hours. What happens after 2 weeks --> 13 weeks with megadoses in live animals? Cellular damage? Who knows. The paper also brings up the fact that spectrin (one of the proteins broken down by calpain) is not only involved in the cytoskeletal cellular stucture in the brain, but also in "the regulation of cellular morphology in red blood cells and muscle sarcomeres." Ah, the minefield known as neuro-pharmacology...
And a more recent one from Dr. Lynch -
>>> LTP consolidation: Substrates, explanatory power, and functional significance.Lynch G, Rex CS, Gall CM.
Department of Psychiatry and Human Behavior, Gillespie Neuroscience Research Facility, University of California, Irvine, CA 92697-4292, USA.
Long-term potentiation (LTP) resembles memory in that it is initially unstable and then, over about 30min, becomes increasingly resistant to disruption. Here we present an hypothesis to account for this initial consolidation effect and consider implications that follow from it. Anatomical studies indicate that LTP is accompanied by changes in spine morphology and therefore likely involves cytoskeletal changes. Accordingly, theta bursts initiate calpain-mediated proteolysis of the actin cross-linking protein spectrin and trigger actin polymerization in spine heads, two effects indicative of cytoskeletal reorganization. Polymerization occurs within 2min, has the same threshold as LTP, is dependent on integrins, and becomes resistant to disruption over 30min. We propose that the stabilization of the new cytoskeletal organization, and thus of a new spine morphology, underlies the initial phase of LTP consolidation. This hypothesis helps explain the diverse array of proteins and signaling cascades implicated in LTP, as well as the often-contradictory results about contributions of particular molecules. It also provides a novel explanation for why LTP is potently modulated by factors likely to be released during theta trains (e.g., BDNF). Finally, building on evidence that normal patterns of activity reverse LTP, we suggest that consolidation provides a delay that allows brain networks to sculpt newly formed memories. <<<
Then came this paper from Dr. Lynch -
http://www.pubmedcentral.nih.gov/articlerender.fcgi?tool=pubmed&pubmedid=15567513
Here's the full text version of the first Calpain/Spectrin related paper -
http://jpet.aspetjournals.org/cgi/content/full/314/1/16
Ampakineman, The confirmation of the histo problem in the 2nd species, combined with the observation that the degree of the finding is dose related, means that "Houston, we have a problem", at least with CX-717. It also brings up the spectre of a potential class-wide effect with all low impact Ampakines (this doesn't appear to be the case, though we're not totally out of the woods yet on that score). And the fact that no one seems to have seen anything like this cellular change before, or have any idea what might be causing it, doesn't help matters either. Combine this with Cortex running low on money, and you have the 50% haircut.
In my mind, I still haven't ruled out the Calpain/Spectrin phenomenon as the potential culprit for the observed cellular changes. This is the only phenomenon that we know of that is definitely associated with some Ampakines, other than excitotoxicity. If the problem was excitotoxicity related, they would have seen the animals go into seizures, but there were reportedly no clinical signs associated with the histo problem, only microscopic cellular changes.
Dr. Mansbach was asked about the calpain phenomenon in the Q+A at the 12-05 SHM, which was around 6 months after the first calpain/spectrin paper by Dr. Baudry had been published. Dr. Mansbach indicated that they believed it to be a phenomenon associated with some high impact Ampakines (CX-614 was the compound used in the published study). Being caused by a high impact might indicate that the phenomenon (calpain mediated degradation of spectrin/proteins) could be associated in some way to the same process that causes the upregulation of neurotrophins/BDNF. Dr. Lynch also published a calpain related paper, theorizing that LTP (Long Term Potentiation, the process of memory formation) inherently may involve calpain mediated protein breakdown (breaking down old neural connections to forge new ones).
But if Dr. Lynch was right, and LTP is the source of the calpain activity, then theoretically a low impact should also stimulate calpain activity (since low impacts increase LTP just as high impacts do). If on the other hand, the calpain activity is related in some way to an Ampakine's upregulation of neurotrophins, then a low impact wouldn't be expected to produce very much calpain activity. Except perhaps - at extremely HIGH DOSES, and/or after prolonged dosing (exactly where we are seeing the histo finding phenomenon in our test animals).
We know that low impacts can upregulate neurotrophin levels, albeit much less than do high impacts. The analogue CX-727 was shown to upregulate BDNF 20-30% after extended dosing. But what happens during mega "heroic" dosing of a low impact for 2 weeks (as in the rats)? Or during very high dosing for 3 full months (as in the primates)? We don't know, but it may be way to early to rule out calpain as the source of our observed cellular side effects, particularly since no one at either Cortex or among their histopath consultants seems to have the foggiest idea what might be causing the observed cellular changes.
Brigrajac, Here's a brief summary -
1) Primates -
Original 13 week study - the histo finding was seen.
New 1 week study (higher doses) - clean.
New 2 week study - (higher doses) - clean.
New 3 month study - (higher doses) - results approx year end.
2) Rats -
Original short term studies - clean.
Original 3 month study - clean.
New 2 week study (much higher doses) - histo finding seen.
New 3 month study (higher doses) - results approx year end.
3) Dogs -
Original 3 month study - clean.
_________________________________________________
Some additional info -
We investors don't know the dose that produced the histo finding in the original 13 week primate study. The doses that produced the histo finding in the new 2 week rat study were in the 1 gram/kg to 1.5 gram/kg range ("heroic dosing"). In the rats there was a dose proportional response in producing the histo changes. This clearly relates the histo changes to CX-717.
Studies to assess recovery from the observed histo changes after the cessation of dosing are still underway, but the early evaluation show that most but not all of the histo changes disappear within 2 weeks. We still must wait for the last set of data to get a complete picture of the recovery potential.
Cortex used a new US based CRO to conduct the new studies. At the request of Cortex's histopath consultants, in the new studies they changed the method used to sacrifice the monkeys and for fixation of the tissue samples (to help eliminate the chance that the histo finding was merely an artifact).
Cortex is also doing electron microscopic tests to further explore what the histo finding might be. Studies to explore the various metabolites of CX-717 and their possible effects are also being done.
Neuro, Concerning the primate studies, the one requested by the FDA was 1 week long, but Cortex also did a separate 2 week primate study on their own. Dr. Stoll said that this 2 week primate study did not show any of the histo changes noted in the original 13 week primate study from last year. The data from this 2 week primate study will be sent to the FDA at a future date. As we know, there is also a new 3 month primate study, which is still ongoing.
OT - This is OT and a little off the wall, but one of the frustrations I've experienced when investing in individual stocks is that I find so many interesting companies, not only in biotech but all over the place. Elbit for example, was one I found through Dew, a really intriguing Israeli-based company. Stericycle (medical waste) is another one, and Aqua America (water industry), and Garmin (avionics, GPS gear), etc, etc - it's endless, with interesting opportunities all over the place. Added to all the promising biotech companies out there (it's easy to come up with 20 or so of those without even trying), and following/trading all these stocks is a daunting task - almost like running your own mutual fund.
What I wish for, but which doesn't exist yet, is some way to own a broad basket of all my favorite stocks, and being able to freely buy or sell the entire portfolio at will with a single trade, like one would with a mutual fund or ETF. Without the ability to do this, trading in and out across one's entire portfolio requires making dozens of separate buy and sell trades every time you want to enter or leave the market - a major pain in the butt for tax reporting, to say nothing of the brokerage fees/transaction costs.
Say you have $60,000 spread fairly evenly among your favorite 30 stocks. They've had a big run recently and you want to take say 25% off the table evenly across the board. There's no easy way to do it. As a believer in diversification, particularly when it comes to individual stocks, I found this to be one of the most frustrating aspects of investing. Someday maybe some genius will find a way for investors to accomplish this kind of broad portfolio trading cheaply and simply (the way ETF's allow trading entire sectors/sub-sectors, or like "Share Builder" allows individual investors to buy tiny amounts of individual stocks on a monthly basis).
Looking at the limited alternatives, Dr. Stoll has got to be considering making some overtures to Organon. With Organon's current uncertainties over Asenapine, their upcoming IPO, and their continued dependence on Akzo, I wonder if Organon is in a position to readily do such a deal. It would help bolster their pipeline, though perhaps the company is too preoccupied at the moment with Asenapine and the IPO.
From Dr. Stoll's perspective however, all possible avenues need to be explored, because a PIPE at these levels is going to be very ugly, on the order of PIPE #1 back in 2003 that was desperately done to save the company (priced at $1.50). PIPES #2 and #3 were priced at $2.75 and $2.66, which while not great, were considerably better than $1.50. I don't even want to even think about it. Oh well, that's the nature of micro cap bio stocks I guess, from the penthouse to the outhouse over night. On the other hand, the reverse can also happen occasionally too. Yes, it's been a long strange trip for this company.
Neuro, Thanks. That reference to 1 out of 12 primates must have been from the Q+A portion of the SHM. Much of that Q+A wasn't audible on the webcast, so we weren't able to hear large portions of it.
Concerning the financing, in the recent conf call, Dr. Stoll clearly stated that "Given where we are, it's a practical reality that sometime by early next year we're going to have to find a way to get some additional financing." It doesn't get much clearer than that.
The only ways I can figure a PIPE might be avoided would be -
1) If a lot of warrant excercising suddenly occurred, but that won't happen with all those warrants currently far under water,
2) A buyout of Cortex by another company, not impossible, but not likely,
3) Some kind of BP deal for AD/Neurodegenerative prior to the FDA's decision on liberalizing the dosing of CX-717 (that FDA decision is due in Q2-07, assuming the full package of new data is submitted, as Dr. Stoll estimated, by the end of Q1-07). Such a pre-FDA decision BP deal wouldn't be impossible if for some reason the data from the new animal studies looks considerably better than expected (and the BP decides to move prior to the FDA's decision).
4) An AD/Neurodegenerative deal with Organon. This would be possible, particularly since by having Org-24448 ready and available, the fate of CX-717 is less of a concern to Organon. The N.Amer Neurodegenerative rights would have a relatively high value to Organon even without CX-717, and acquiring these rights would go a long way to consolidating the global Ampakine rights (Schizo, Depression, Neurodegenerative). This might be an attractive option for Cortex, if the upfronts are high enough, and a carveout of ADHD/Sleep Related/Orphans or some combination is possible.
Neuro is right - the Ampakine platform still has gigantic potential. All we may really have right now is the possible failure of a single compound (and even that might be partially salvageable). The other near term problem is the prospect of a cash crunch/unattractive financing.
Looking at the big picture for the Ampakine platform itself -
1) Low Impacts - If the histo finding is not a class-wide effect (we don't know that for sure yet either way, but the odds are good that it isn't) then long term the low impact Ampakine potential is still there, big as ever, albeit delayed somewhat.
2) High Impacts - The vast potential here is unaffected by the current CX-717 woes, other than the lack of funds to advance it as rapidly as it could be.
3) IP/Patent Estate - This hasn't changed, it's as broad and deep as ever.
4) Indications - Something we know now that we didn't know a year ago is that a low impact can have phenomenally great activity in humans with ADHD, showing highly statistically significant improvement in both hyperactivity and attentiveness. If we saw this with CX-717, we can almost certainly see it with another low impact compound.
Daviddal, Speaking of dogs, that was the only animal species that apparently didn't show the histo finding. So perhaps there's still the market for improving olfaction in drug sniffing dogs. Remember that guy over on Yahoo who kept bringing up that weird indication? Maybe he was clairvoyant after all :o)
Neuro, In the beginning of the recent conf call, Dr. Stoll said "...the full extent of the histopath changes noted in a particular target organ of the monkeys." (plural) Whether his saying monkeys was intended to indicate more than one monkey or was just a slip, I don't know.
Do you remember Dr. Stoll previously indicating that the finding was in a single monkey? Thanks.
Daviddal, The odds of the new primate study showing no histopath finding at all is probably close to zero (Stoll said "I can't imagine we're going to see absolutely nothing" in response to that same question by Piros). Not only are both primate studies of the same 3 month duration, but Stoll said that the new study will be at a much higher maximum dose than was the first study.
If there are more dosing levels used in the 2nd study, that might conceivably help (say 6 levels instead of 4 for example, since we could more accurately pinpoint at exactly what dose level the histo finding starts to appear). However, we don't know if there will in fact be more dosing gradations or not. Stoll basically suggested that our best hope in seeing less evidence of the histopath finding lies in the different method that the tissue is being prepared and visualized in the new study. That doesn't inspire lot of confidence as I see it.
Than again, who knows. My predictions for this year have been pretty lousy to date -
a) ADHD results - I was very cautious (wrong)
b) Shift Work results - I was extremely confident (wrong)
c) FDA hold decision - I figured the FDA might want more data due to ambiguous results from the new studies (correct, sort of)
Neuro, Isn't it likely that the FDA's dosing limitation level was based more on the dose that caused the histo problem in the primates than on the dose that caused the histo problem in the rats? (Since presumably that causative dose was at a lower level in the primate than in the rat). That being the case, the 75 X idea might not be the correct benchmark to go by in doing our theoretical figuring.
I guess the lesson here is that diversification is essential for survival in the bio sector - for investors as well as companies. Stoll really had no other choice but to roll the dice with CX-717. We investors, on the other hand, can easily spread our bets around.
Here are 16 stocks I still follow loosely. I figure even if some of these flame out completely, an investor would still do OK overall, and at least live to fight another day -
Biomarin
Cubist
Celgene
Durect
Exelixis
Genzyme
Gilead
GTCB
Idenix
Medarex
MGI Pharma
PDLI
Pain Therapeutics
Senomyx
Teva
Vertex
Bombs away..
On the lighter side -
>>> A Biotech Frankenstock
By Brian 'Fright Night' Lawler
In Mary Shelley's novel Frankenstein, the fictional monster was an amalgamation of parts from various corpses; when combined, those parts were supposed to form a beautiful creature. Unfortunately, things didn't work out so well, and Victor Frankenstein created a monster.
Nonetheless, Shelley's novel inspired me to imagine what a biotech Frankenstein's monster would look like. This creature would be composed of the best aspects of all the biotech stocks out there, and when sewn together, it would form the ultimate Frankenstock! (Cue ominous lightning, maniacal laughter, etc.)
Frankenstein's monster was nothing until he was given a brain, so I'll steal the experience and intelligence of Genentech's (NYSE: DNA) management team for my Frankenstock. They've been in the industry for a long time, including a CEO who's been with the company for 25 years, and most of its team members have proven scientific backgrounds. In addition, they have historically been one of the more honest, shareholder-friendly management groups in an industry that sometimes lacks scruples -- particularly in its stock option grants.
The heart of this wild biotech beast obviously needs to work reliably under stressful conditions. I've chosen the ticker of Cephalon (Nasdaq: CEPH), which has dependably grown sales 44% and adjusted earnings 31% this year, despite being under legal attack, overcoming regulatory setbacks, and facing near-term generic competition for one of its lead drugs.
Our mad biotech creature won't intimidate others unless he can tower over them, so I'll extend his reach by stitching on PDL Biopharma's (Nasdaq: PDLI) patent collection. That way, I'll capture royalties on nine marketed humanized monoclonal antibodies, and the potential for royalties on at least 34 more drugs in phase 2 clinical trials or later.
The creature will be useless without muscles, so we'll pump him up with the brawn of Roche's (OTC BB: RHHBY.PK) sales and marketing force, and its $33 billion in 2005 drug sales. Its striated marketing muscle is strong in every part of the world, with North American and European drug sales only accounting for 40% and 32% of its total drug revenues. This way, any drugs that our monster produces will easily overpower the competition.
The innards of our biopharmaceutical freak of nature will come from Exelixis (Nasdaq: EXEL). Its internal development, with nine drug candidates in clinical trials and another nine in the preclinical stage, will be essential for this biotech monster's long life and continued growth.
No biotech colossus will be complete unless it can defend itself, so we'll have to teach it the ways of Merck's (NYSE: MRK) legal team. They'll have loads of experience fighting lawsuits once they finish litigating against the more than 23,000 Vioxx-related suits thus far.
Feel like creating your own biotech monster? It's actually easier to make one than you think. Just head on over to Motley Fool CAPS to build a portfolio of biotech or any other stocks. Then see how your Frankenstock performs against others as well as get to see other people's CAPS creations and learn from the collaborative research of thousands <<<
Neuro, board, Do you remember the dosing regimen being used in the AD PET study? I seem to remember the upper dose as a single 1000 mg dose, with some lower dose levels also part of the protocol. I have this info somewhere on audio tape (Dr. Mansbach gave it at a conference last year), but my detailed transcribed notes were unfortunately thrown out.
Since the AD PET study was released from clinical hold, it would seem logical that 1000 mg would be within the currently allowable dosing limits, at least as a single dose.
Neuro, If 200-400 mg once/day is OK with the BP partner, then that's all that matters from a deal making standpoint. Having watched CX-717's development over the last several years however, I have some doubts that they'll get good results in humans at doses that low.
My scenario would assume some type of near term PIPE financing - unfortunate, but we probably can't get around it.
Once we do the AD/Neurodegenerative BP deal (say by Summer), Cortex would have to be very tight with their money, concentrating on a focused 2 prong strategy - a) getting CX-701 through Phase 1 and into Phase 2a for ADHD, and b) getting the high impact CX-929 into the clinic. There's not going to be extra money around to even consider a non-Ampakine in-licensed parallel program as an insurance policy. With my approach, we go all out with the Ampakines.
Here's the strategy I'm hoping for -
1) The FDA liberalizes the dosing of CX-717 just enough to make pursuing AD/MCI a truly viable option (longer term 800-1000 mg once/day dosing allowed).
2) Cortex then does a BP deal for CX-717 / N.Amer Neurodegenerative rights. In the deal, Cortex carves out ADHD, the various orphans, and possibly Sleep Related indications from the BP deal.
3) Cortex continues getting CX-701 or another backup up to speed and then moves it into ADHD trials. This compound would have been pre-tested in animals to confirm that it definitely doesn't have the histopath problem.
4) Cortex forgets about the in-license idea and concentrates on a) getting CX-701 into ADHD trials, and b) getting a high impact (CX-929) into the clinic.
5) Once CX-701 shows good Phase 2a results in ADHD, we do a BP/pharma deal with it (say with Shire). Later, once CX-929/high impact starts looking good clinically, we outlicense it to the same BP who own the N.Amer Neurodegenerative rights. This gives Cortex 2 reasonably big future money-raising opportunities.
6) The heavy lifting done, then Cortex considers pursuing orphan and/or Sleep Related indications in-house with another low impact, or else possibly doing a non-Ampakine in-license if that's the direction they want to go.
Concerning the Organon strategy, there are numerous drawbacks, including Org-24448 itself. In a past presentation, Dr. Stoll said that CX-717 was developed to improve upon some of the metabolic shortcomings seen with Org-24448 (he didn't elaborate on what those shortcomings were, only that there were some metabolic issues that they weren't particularly thrilled with). Org-24448 is considerably less potent than CX-717 and has a shorter halflife (30 times more potent than CX-516 vrs 50 times for CX-717, and a 6 hour halflife vrs 9-10 hours for CX-717). For ADHD, CX-717 had at least the potential for once/day dosing, where Org-24448 would almost certainly need BID dosing, and would probably need significantly higher dosing levels than CX-717 (and high dosing requirements was already a problem for CX-717/ADHD). The other big disadvantage is in having all the eggs in the Org-24448 basket (Schizo, Depression, ADHD, AD/MCI, etc). Organon could conceivably use a different compound for ADHD/AD, but then we're faced with the same long delay we'd have if Cortex went ahead on its own with CX-701.
The big problem is lack of money. With CX-717 in limbo, there's no easy way to get it.