Axovant parades new preclinical therapy, much to investor delight
- Axovant Sciences is dropping $10 million to access a handful of gene therapy programs from an Australian biotech, including one preclinical treatment for a rare muscular disease.
- Per its deal with Benitec Biopharma, Axovant gets worldwide rights to the treatment, known as AXO-AAV-OPMD, and five additional gene therapy products targeting neurological disorders. The immediate plan is to take the treatment into the clinic in 2019, testing it in patients with oculopharyngeal muscular dystrophy (OPMD).
- Benitec is eligible for several kinds of milestone payments, and would take home 30% of the net profits on global sales of AXO-AAV-OPMD should it reach the market. The biotech may also receive tiered royalties on the other potential products stemming from the collaboration.
There wasn't much to Axovant when prominent biotech investor Vivek Ramaswamy founded it in late 2014. Though its only drug, intepirdine, failed in the clinic under GlaxoSmithKline, the Swiss biotech proved formidable at raising capital, bringing in hundreds of millions of dollars from a 2015 initial public offering.
Axovant wasn't able to turn intepirdine into a success, however. It scrapped the drug after misfires in the Phase 2b HEADWAY study of dementia patients with Lewy bodies and, most notably, the Phase 3 MINDSET study of patients with mild to moderate Alzheimer's disease.
The failures crushed Axovant's stock and left its pipeline relatively bare. Until recently, the biotech held just two clinical-stage assets, one of which yielded some mixed interim results in a Phase 2 trial of dementia patients.
Linking up with Benitec therefore provides Axovant a much-needed pipeline expansion. In addition to the preclinical OPMD treatment, Axovant and Benitec will be researching a gene therapy that targets the C9orf72 gene, which could have applications for amyotrophic lateral sclerosis and frontotemporal dementia patients.
The new collaboration also underscores Axovant's interest in gene therapies. Last month, the biotech committed $30 million in cash to procure exclusive rights to Oxford BioMedica's Parkinson's disease gene therapy and its predecessor product, ProSavin.
Investors have reacted positively to the deals, with stock value surging 160% after the Oxford BioMedica licensure and as much as 17% early Monday on the heels of the Benitec agreement. Late morning trading pared back some of those gains and shares were up by about 5% at $2.69 apiece just before noon — still down about 50% year to date, however.
Regarding AXO-AAV-OPMD, Axovant is planning a placebo-controlled dose-escalating study with key assessments on safety and tolerability, as well as muscle biopsy, dysphagia severity and patients' swallowing function. The biotech is looking to dose the first patient sometime next year.
OPMD affects about 250,000 people in the U.S., according to the National Organization for Rare Disorders, and can elicit muscle deterioration in the throat, which in turn can cause food or liquids getting caught in the lungs and contribute to inflammation or infection. AXO-AAV-OPMD in theory functions as a "silence-and-replace" therapy, delivering RNA interference to mute the problematic DNA behind the disease and then also a functional copy of the gene.
"It's only when you're able to knock down the dysfunctioning gene, which leads to those protein aggregates and improper processing of RNA, and replace it with an optimized, functional copy that's resistant to RNA interference — that's when you see the desired clinical effect," Pavan Cheruvu, Axovant's new CEO, said during a July 9 conference call.
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