Anavex Life Sciences Corp (AVXL)

[hooperg83]

A Balanced Riposte to Mr. Feuerstein's Latest


(Hopefully) To appear in Seeking Alpha tomorrow:

I am a Medical Corps Officer. It's what I do. Over the past 13 years, I've refined a skill set that allows me to practice competently and confidently in a given environment, with a given set of tasks, with a given risk. I am not an Infantry Officer, a Field Artillery Officer, or an Armor Officer. If I were to walk into their world and start giving advice, offering criticism, or speculating on what's right/wrong, I'd most likely receive a polite "get lost" if I were lucky. However, in the event that I am required or elect to approach a field with which I am not familiar, I will conduct thorough and diligent research, cite reputable literature, and speak/write with the utmost humility. I find that this strategy promotes learning, fosters a collegial environment, and creates an atmosphere of respect.

In Mr. Feuerstein's most recent article regarding Anavex, Northwest Biotherapeutics, Threshold Pharmaceuticals, and Biomarin, it appears he needlessly goes for the throat.

Beginning with Anavex (NASDAQ:AVXL), dismissing animal data is folly. Specifically, dismissing animal data regarding mice (Mus musculus) is insulting not only to the scientific method, but also to the researchers. Mice share approximately 95% or more of the same genes as human beings, and are susceptible to many of the same diseases [1]. Indeed, of the 4000 genes studies in human beings and mice (as of 2010), less than ten are found in one species, but not the other [2]. As such, mice-especially genetically modified mouse models (GEMMs)-provide an invaluable research model that is critical in early drug development, as they support clinical translation [3, 4] Though imperfect, some mouse models are also predictive of human clinical efficacy [5].

Continuing, Feuerstein chides Anavex's recent announcement regarding 3-71, labeling it a "repeat." No, it's not a repeat. A repeat would be a press release citing the same 2014 results, which were based on a poster presentation at the AAIC [6]. The new results that were announced recently, which were deemed fit to publish in a major, peer reviewed scientific journal, were just that-new results. Yes, the same compound is the topic, but it included remarkable, new data, including the observation of reversal of synaptic loss in hippocampal neurons [7, 8].

Worse, Feuerstein describes AF267B, another drug out of Dr. Fisher's lab, as having the same mechanism of action as AF710B (3-71). This is absolutely incorrect. AF267B is an orthosteric agonist of M1 receptors [9]. AF710B is an allosteric modulator of M1 receptors as well as a sigma-1 receptor agonist.

Finally, regarding the Lincoln Park Capital (LPC) financial deal, Anavex determines when LPC is able to purchase up to $50 million of their shares. The timeline is over three years. I'm uncertain how the LPC deal correlates to recent press releases and Anavex's volatility, given the deal hasn't been executed; therefore, I don't see how LPC can profit from this volatility as stated.

Mr. Feuerstein leads his second investment discussion about Northwest Biotherapeutics (NASDAQ:NWBO) with an interesting anecdote regarding a discussion between him and an unnamed healthcare investment fund manager. Such is fine, the implied respect of privacy, in a public forum; however, does not anyone else find it ironic that he fails to mention that the allegations of financial impropriety against NWBO emerge from an anonymous internet source [10]? Yes, it is concerning that a major shareholder (Mr. Woodford) would pen a letter requesting an inquiry into the allegations. Regardless, Mr. Feuerstein's article also fails to mention that NWBO welcomes expansion of their board and an independent investigation. This information was available at least two days prior to the publication of today's article. To his credit, Mr. Feuerstein raises some interesting questions regarding NWBO's clinical trials and financial dealings, but the omission of important facts, whether intentional or accidental, undermines the entire thesis.

Moving on to Threshold Pharmaceuticals (NASDAQ:THLD), which has two Phase 3 clinical trials underway and partnership with Merck KgaA. The primary Phase 3 trial in question, MAESTRO, pairs evofosfamide with gemcitabine versus gemcitabine alone in metastatic pancreatic cancer. To begin, pancreatic cancer is a death sentence, unless you're a Whipple candidate, and even then, survival is not good. Personally, I cannot think of a worse neoplasm to have, aside from perhaps glioblastoma multiforme or medullary kidney cancer. Therefore, progression free survival (PFS) and overall survival (OS) may seem small, but in this context, they're progress. In phase 2 clinical trials, evofosfamide and gemcitabine demonstrated a dose-dependent, statistically significant improvement in progression free survival, but no statistical significance in OS, though by their admission the study was not designed for OS [11]. Mr. Feuerstein's article from 2012 regarding this study, in my opinion, is informative and well-written for the most part [12]. However, in this article, he notes the detriment of the crossover effect, in which patients may switch from one therapy to another. Yes, crossover may impart selection bias by removing patients whose disease progresses, but at the same time, it may also add favorably to the body of knowledge. How? This same study noted a significant OS benefit in the crossover group even between evofosfamide doses (higher doses fared much better), though this information was not included in his 2012 article.

Turning to his most recent article: absolutely, THLD has their work cut out for them, especially given the fact that Abraxane received approval for pancreatic cancer treatment. Abraxane is a taxol derivative, and when paired with gemcitabine, demonstrates a statistically significant 8.7-month OS versus gemcitabine alone [13]. This does not mean that the MAESTRO trial is worth writing off as doomed to failure. Nor does it mean that Mr. Feuerstein's a priori price machinations are accurately baked into the value of THLD. Let the trial run its course!

Lastly with respect to THLD, his statement comparing palifosfamide is very misleading. It is confusing in that it insinuates THLD has already conducted (and failed) an evofosfamide phase 3 trial in sarcomas, whereas a phase 2 study showed promise in just such a setting. Semantics aside, comparing evofosfamide with palifosfamide in their theoretical applicability to a tumor, based on a rudimentary understanding that they're both alkylating agents, is disingenuous and simplistic. To put this in perspective, it would be like claiming my Honda Civic is equivalent to a Rolls-Royce Ghost because they're both sedans.

And finally - BioMarin Pharmaceuticals (NASDAQ:BMRN): the company advancing drisapersen for the treatment of Duchenne's Muscle Dystrophy (DMD). Probably one of the saddest diseases in existence, DMD is an X-linked recessive process affecting boys. In this disease, an exon mutation precipitates an mRNA misreading (frameshift or nonsense mutations) that terminates dystrophin translation or results in a nonviable dystrophin protein. Ultimately, in the absence of dystrophin, the child's skeletal muscle disintegrates over time, followed later by failure of cardiac muscle. In other words, it's 100% fatal. Drisapersen attempts to interrupt this process by knocking an exon out of the spliceosome (exon 51), which results in an imperfect, but better-than-nothing dystrophin translational product [14]. Unfortunately, drisapersen has a troubled history, and indeed has a major side-effect profile [15]. I say unfortunately as emphatically now as I would even if I were a BMRN shareholder, because there is nothing else for this awful disease. I believe the company's best chance for approval hinges on the fact that nothing else is available, which is a sad statement. In this case, I am of the opinion that Mr. Feuerstein's negative outlook on this company is somewhat vindicated. In any event, I remain optimistic that this novel mechanism of action provides therapeutic benefit somewhere. Only 13% of DMD cases are amenable to exon 51 skipping, so hopefully other companies, like Sareptra Therapeutics, can pursue other avenues of approach to treating this disease.

As always, I've made every attempt to ensure factual accuracy in the above. I apologize if I have misstated anything, and offer addendums freely in such an event! I open the floor for discussion in the comments section for any corrections, discussions, or gripes!

Respectfully,

Dr. H

Note: The above are my own opinions, including some of which that reflect my personal financial interests. These opinions are my own and do not reflect the official opinions or financial interests of the US Government or US Army.


SOURCES:

1. Schultz, L. Why Mouse Genetics? The Jackson Laboratory. 2015. Accessed December 2, 2015. https://www.jax.org/genetics-and-healthcare/genetics-and-genomics/why-mouse-genetics

2. Why Mouse Matters. National Human Genome Research Institute. NIH. Updated July 23, 2010. Accessed December 2, 2015. https://www.genome.gov/10001345

3. Of mice and men - are mice relevant models for human disease? Outcomes of the European Commission workshop 'Are mice relevant models for human disease?' London, UK 2010. Accessed December 2, 2015. http://ec.europa.eu/research/health/pdf/summary-report-25082010_en.pdf

4. Denayer T, Stoehr T, Van Roy M. Animal models in translational medicine: Validation and prediction. New Horizons in Translational Medicine. 2014;2(1): 5-11. http://www.researchgate.net/publication/266382223_Animal_models_in_translational_medicine_Validation_and_prediction

5. Chesi M, Matthews GM, Garbitt VM, Palmer SE, Short J, et al. Drug response in a genetically engineered mouse model of multiple myeloma is predictive of clinical efficacy. Journal of Blood. 2012; 120(2): 376-385. http://www.bloodjournal.org/content/120/2/376?ijkey=14c152d9737e53ec6e7ac1393e801480c1d6dfa8&keytype2=tf_ipsecsha

6. Fisher A, Medeiros R, Bar-Ner N, Brandeis NR, Elkon H, et al. M1 muscarinic agonists and a multipotent activator of sigma1/M1 muscarinic receptors: Future therapeutics of Alzheimer's Disease. Alzheimer's Association International Conference (AAIC) 2014. Poster Presentation. http://www.anavex.com/pdf/2014-07-13_Fisher_Abstract_for_AAIC_meeting_2014.pdf

7. Independent Research Describes Anavex 3-71 as Potent Cognitive Enhancer in Alzheimer's Disease Models. Press Release, New York November 30, 2015. http://www.anavex.com/?news=independent-research-describes-anavex-3-71-as-potent-cognitive-enhancer-in-alzheimers-disease-models

8. Fisher A, Bezprozvanny I, Wu L, Ryskamp DA, Bar-Ner N, et al. AF710B, a Novel M1/ s1 Agonist with Therapeutic Efficacy in Animal Models of Alzeimer's Disease. Neurodegener Dis. 2016; 1(1-2). Online First ABSTRACT ONLY. http://www.karger.com/Article/Abstract/440864

9. Fisher A, Brandeis R, Bar-Ner RH, Klinger-Spatz M, Natan N, et al. AF150(S) and AF267B - M1 muscarinic agonists as innovative therapies for Alzheimer's Disease. Journal of Molecular Neuroscience. 2002; 19(1-2): 145-153. ABSTRACT ONLY. http://www.researchgate.net/publication/11175896_AF150(S)_and_AF267B_-_M1_muscarinic_agonists_as_innovative_therapies_for_Alzheimer's_disease

10. Anonymous Report Spurs Fund Manager to Call in Ex-FBI Agent to Investigate NW Bio . PR Newswire, 11/30/2015, via Biospace. Accessed December 2, 2015. http://www.biospace.com/News/anonymous-report-spurs-fund-manager-to-call-in-ex/401107/source=TopBreaking?intcid=homepage-seekernewssection-tabtopbreakingnews

11. Borad MJ, Reddy S, Bahary N, Uronis H, Sigal DS, et al: TH-302 plus gemcitabine vs gemcitabine in patients with untreated advanced pancreatic adenocarcinoma. Abstract 6660. Presented September 29, 2012. http://www.thresholdpharm.com/pdf/borad_et_al_th-302_in_pancreas_cancer_esmo_09-12.pdf

12. Feuerstein A. Threshold Pharma Seeks to Erase Doubts About Pancreatic Cancer Drug. The Street. Published 10/01/2012. Accessed December 2, 2015. http://www.thestreet.com/story/11722680/2/threshold-pharma-seeks-to-erase-doubts-about-pancreatic-cancer-drug.html

13. Goldstein D, El-Maraghi RH, Hammel P, Heinemann V, Kunzmann V, et al. nab-Paclitaxel Plus Gemcitabine for Metastatic Pancreatic Cancer: Long-Term Survival From a Phase III Trial. J Natl Cancer Inst. 2015;107(2): dju413. http://jnci.oxfordjournals.org/content/107/2/dju413.full.pdf+html

14. Flanigan KM, Voit T, Rosales XQ, Servais L, Kraus JE. Pharmacokinetics and safety of single doses of drisaperen in non-ambulant subjects with Duchenne muscular dystrophy: Results of a double-blind randomized clinical trial. Neuromuscular Disorders. 2014; 24(1): 16-24. http://www.sciencedirect.com/science/article/pii/S0960896613009565

15. Anderson P. FDA Panel Critical of Drisapersen Data in Duchenne. Medscape. Medscape Medical News: Neurology. Published November 27, 2015. Accessed December 2, 2015. http://www.medscape.com/viewarticle/855116#vp_3