RespireRx Pharmaceuticals Inc (RSPI)

[tonyvanw]

This suggests that a sale of the company is a reasonable possibility.

Posted on Silicon Investor: http://siliconinvestor.advfn.com/readmsg.aspx?msgid=23963827

Cortex Falls As FDA Rejects CX717 Phase IIb In ADHD


By Trista Morrison

Staff Writer

Shares of Cortex Pharmaceuticals Inc. plunged 59 percent after the FDA rejected a proposal for a Phase IIb trial of lead ampakine compound CX717 in attention deficit hyperactivity disorder.

"I think this could have grave consequences for Cortex, not because I don't believe in ampakines, but because the company may not be able to finance in the future," Rodman & Renshaw analyst Elemer Piros told BioWorld Today.

After hitting new 52-week lows, Cortex's shares (AMEX:COR) closed at 73 cents on Thursday, a loss of $1.07. The Irvine, Calif.-based company reported $8.7 million in cash and marketable securities as of June 30 and raised $14.2 million in a registered direct offering in August, but Piros said he doesn't expect any robust new clinical data between now and when that money will run out in about a year. He downgraded the stock to "underperform."

The FDA's rejection was based on results of animal toxicology studies that have long plagued the CX717 program. Toxicology concerns resulted in a clinical hold on the program last year, which was lifted by the FDA's Division of Neurology Products so Cortex could begin a trial in Alzheimer's disease. (See BioWorld Today, April 4, 2006, and Oct. 30, 2006.)

But the Division of Psychiatry Products, which oversees ADHD trials, proved harder to convince. Cortex submitted data indicating the animal toxicity issues were due to post-mortem tissue processing and showing that CX717 was well-tolerated in a previous Phase IIa ADHD trial, but the agency refused to approve the Phase IIb plan.

Cortex President and CEO Roger Stoll said the company is "unlikely" to try again with CX717 in ADHD, but that the Alzheimer's trial is moving forward and should be completed in mid-2008. The trial uses a dose that is five- to tenfold less than that required for ADHD, but Piros noted that the efficacy of such a low dose has not yet been proven in humans.

Stoll said Cortex also is planning initial European clinical trials to evaluate CX717 in the acute treatment of respiratory depression, which would use short-term rather than chronic dosing.

A backup compound known as CX701, which is more potent and has a longer half-life, is slated to begin European clinical trials this quarter. And CX1763, which has a mechanism conducive to use in neurodegenerative diseases such as Parkinson's disease and Huntington's disease, is scheduled to move into preclinical toxicology studies early next year.

Cortex's clinical data thus far have been mixed. Although CX717 has had toxicity issues, the Phase IIa ADHD trial showed that a high dose caused a positive trend in the ADHD Rating Scale and a statistically significant effect on the hyperactivity subscale compared to placebo (p=0.05). A subsequent trial of CX717 in alertness during night shift work didn't enhance cognitive performance but altered recovery sleep architecture.

A previous compound known as CX516 failed to meet its primary endpoint in a Phase IIb cognitive impairment trial. But Piros called the compound "silly" due to the fact that it required memory-impaired patients to take large doses four times daily, and he said Stoll was right to kill the program. (See BioWorld Today, Feb. 18, 2004.)

Piros said he is "still a fan" of the ampakine approach. Ampakines target AMPA receptors, a subtype of glutamate receptors involved in the long-term potentiation underlying memory and the excitatory stimulation that often is reduced in cognitive disorders. In a research note, Piros pointed out that Merck and Co. Inc.'s head of neuroscience research, Dennis Choi, told Fortune magazine that ampakines are one of the most promising approaches for memory enhancement.

Cortex's biggest problem, Piros said, has been its financial restrictions, which have forced programs to move forward in a linear fashion and never allowed "multiple shots on goal." He predicted that a partnership is unlikely at this stage, but he encouraged Cortex's management to "consider the sale of the company to a larger organization" that could fully exploit the technology.

Cortex has significant intellectual property covering AMPA modulation and has a partnership with NV Organon for schizophrenia and depression. French firm Les Laboratoires Servier has an option to license up to three neurodegenerative disease compounds from a partnership with Cortex that ended in late 2006.

For now, Stoll said his team is focused on trying to "define the best way to build Cortex." But he added that if an acquisition offer comes along, "we have to look at it."

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