Anavex Life Sciences Corp (AVXL)

[Investor2014]

Expanded Access & Billions & Billions & Billions of Revenue - NO!

First my opinion and conclusions on the AVATAR results and approval path, then some facts about Expanded Access.

It remains my opinion that approval of A2-73 for Rett may not come until after EXCELLENCE data confirms the RS-001 & RS-002 study findings and makes the case very strong if confirming younger patients benefit more with greater separation between Drug and Placebo Responders.

As Missling explained last night as below:

So we made it for the FDA easier. That's why I think the guidance is very clear because they want to make sure that you just don't have an average statistical improvement of a certain percentage and/or score, but it doesn't mean anything to anybody. Nobody can confirm that it is beneficial. The physician cannot assess it or confirm it. The patient cannot confirm it, and the parents cannot confirm it, but it's statistically significant. So it doesn't help anybody.

So by using this approach of the CGI anchored RSBQ, you'll see we were able to raise the bar, make it easy to interpret.

We must note that the Clinically Meaningful measure of Responder is consistent between the Drug and Placebo arm outcomes, from the AVATAR TOP-LINE slide 12:

ANAVEX®2-73 induces a clinical meaningful improvement of RSBQ AUC* in 72.2% of patients as compared to 38.5% on placebo; (p = 0.037)

Of course the drug clearly appears to work, but still using the exact same measure and zero drug PK exposure, 38.5% of placebo patients are Responders and this is quite high. Higher I would think than most of us would have expected especially given the more stringent endpoint measure.

The day-to-day variability of behavior in Rett and the observer/questionnaire based scoring makes the endpoint measure somewhat unreliable. The CGI-I Anchored RSBQ AUC tries to compensate for the inherently subjective measures and is the best there is, The scores certainly imo distances the AVATAR results quite significantly from the outcome of the ACADIA Trofinetide trial viewed through the same lens. see See PeterKarol's excellent reverse engineered estimated Trofinetide RSBQ AUC comparison.

An obvious way of putting any doubt to bed would be to wait for data from the much larger EXCELLENCE trial and look for even better response grouped by age and using the exact same primary CGI-I Anchored RSBQ AUC endpoint measure. Those score being well excellent in a 3rd parallel trial should put any statistical, clinical meaningfulness and questionnaire based scoring reliability concerns to bed and lead to approval of A2-73 for Rett in all age and the issuance of a the paediatric voucher.

Meanwhile, Expanded Access is a stopgap solution for an unapproved drug under a Investigational New Drug Application (IND) to provide patients with Compassionate Use for a limited time before approval re-assessed annually or of course should issues emerge.

Expanded Access, like the Australian TGA SAS Cat B approval, is not created to line a sponsor or shareholders pockets. The sponsor may apply to charge on a Cost Recovery Calculation basis only.

Q17: What costs can a sponsor recover when charging for an investigational drug for expanded access use under 21 CFR part 312, subpart I?
A17: When charging for individual patient expanded access (under § 312.310) to an investigational drug, a sponsor may recover only its direct costs associated with making the drug available to the patient (see Q16 and § 312.8(d)). For individual patient expanded access, the sponsor may not charge for indirect costs, including administrative costs associated with providing an investigational drug. Examples of indirect costs include:

• Costs associated with developing the treatment protocol and informed consent document
• Costs associated with corresponding with the IRB, FDA, and/or the drug manufacturer
• Costs associated with reporting to the IRB and/or FDA
• IRB fees and expenses

When charging for an investigational drug used in an intermediate-size patient population expanded access IND or protocol (under § 312.315) or a treatment IND or protocol (under § 312.320), in addition to the direct drug costs, a sponsor may recover the cost of (1) monitoring the expanded access IND or protocol, (2) complying with IND reporting requirements, and (3) other administrative costs directly associated with the expanded access use (§ 312.8(d)(2)).

Q18. May the sponsor of an expanded access IND or protocol recover the cost of the fees the sponsor pays to a third party for administering an intermediate-size patient population expanded access IND or protocol or a treatment IND or protocol?
A18: Yes. FDA interprets 21 CFR 312.8(d)(2) as permitting the sponsor of an expanded access IND or protocol to recover the cost of the fees paid to a third party for administering an intermediate-size patient population or treatment IND or protocol, including any profit for the third party that may be included in the fees. The fees paid to the third party should be included in the calculation for cost recovery that the sponsor provides in its request to charge.

Charging for Investigational Drugs Under an IND - Questions and Answers

I doubt Anavex would actually apply to recover costs and probably just serve the Rett community in the U.S., Canada, Australia and the UK assuming they invoke their respective versions of Compassionate Use. Upon approval, Anavex can work to set the actual charge for the drug appropriately without having established any precedence and expectations at that time with a Rett community already at least to some extend using blarcamesine daily.