Brainstorm Deal To Boost NurOwn, And Other News: The Good, Bad And Ugly Of Biopharma – Seeking Alpha

Brainstorm Cell Therapeutics inks deal with Catalent to boost NurOwn

Brainstorm Cell Therapeutics Inc. (BCLI) announced that it has entered into a deal with Catalent (CTLT) for manufacturing of NurOwn. The therapy is currently being tested for treating amyotrophic lateral sclerosis. It works by inducing mesenchymal stem cells to express higher number of neurotrophic factors.

Under the terms of the agreement, Catalent will be responsible for transferring the manufacturing process to its new manufacturing site in Texas. It will also undertake the obligation of fulfilling future CGMP clinical supply of the therapy from the new site. Chaim Lebovits, Chief Executive Officer of BrainStorm Cell Therapeutics, said: We know that ALS patients are in urgent need of a new treatment option. If NurOwn is successful in the current clinical trials, this agreement will be integral to ensuring rapid access for patients.

NurOwn cells have emerged as a prominent promising therapy for neurodegenerative disorders. MSC-NTF cells are produced from mesenchymal stem cells. These autologous, bone marrow-derived cells are expanded and differentiated ex vivo. MSCs are converted into MSC-NTF cells by inducing them to secrete high levels of neurotrophic factors under patented conditions. Autologous MSC-NTF cells are able to distribute multiple NTFs and immunomodulatory cytokines directly to the site of damage. This helps in provoking desirable biological effect and slow or stabilize disease progression.

The company is currently working on a double-blind, placebo-controlled, repeat-dosing NurOwn Phase 3 study. The trial has enrolled 200 patients for this purpose. The company has also been granted the FDA approval to start a Phase 2 trial for testing the drug candidate for treating progressive MS. This open label, multicenter trial started the enrolment in March 2019.

Catalent is a leading company in the field of developing solutions for drugs, biologics, cell and gene therapies. It is a full-service partner for adeno-associated virus (AAV) and lentiviral vectors, and CAR-T immunotherapies.

Brainstorm mainly deals in developing autologous adult stem cell therapeutics for debilitating neurodegenerative diseases. Autologous MSC-NTF cells have been granted Orphan Drug status designation by the US FDA and the European Medicines Agency for treating ALS. The company plans to use the positive data from the pivotal study for supporting its application to the FDA.

Brainstorm is currently working in a wide array of indications including ALS, Progressive Multiple Sclerosis, Huntingtons Disease, Parkinsons Disease and Autism Spectrum Disorder. For ALS, the company is currently carrying out Phase 3 studies, while for progressive MS, the program is in Phase 2 stages. For the remaining indications, Brainstorm is carrying out pre-clinical programs.

Analysis: Brainstorm candidate targets a global ALS + progressive MS treatment market valued at ~$791 million in 2018 estimated to reach ~$1,235 million in 2026 at a CAGR of 5.7%. The company has a market capitalization of ~$339 million on a stock price of $10.75, at midpoint of its 52-week range: $3.58-$17.95. One Wall Street analyst is bullish with a price target of $26.50. Major shareholders are the public with over 59% shares and institutions with over 27% shares, while private corporations and insiders hold about 7% each of the 31.57 million shares outstanding. The company has a cash balance of ~$29 million against a debt of $1.5 million, providing a runway of just about 12 months, considering cash burn of $23 million in fiscal 2019 and $27.9 million in the TTM.

Investment Thesis: While the stock has shown steep increase in the past one year, the new deal is expected to provide further push to the price. The company has important catalysts such as the likely approval of the drug candidate coming up.

Aurinia Pharmaceuticals Inc. (AUPH) announced integrated efficacy and pharmacokinetic for voclosporin for treating lupus nephritis. The data has been collated from the companys AURA-LV and AURORA pivotal trials involving 534 patients.

The data showed that 268 patients with lupus nephritis showed statistically significant superior and faster Renal Response rates compared to other cohort of 266 patients. The former group of patients was treated with voclosporin in combination with mycophenolate mofetil (MMF) and low-dose steroids while the latter group was given MMF and steroids alone.

The data also demonstrated that the treatment brought 43.7 percent higher Renal Response rate whereas the control arm showed 23.3 percent at one year. At six months, the respective rates were 31.7 percent and 20.3 percent. Neil Solomons, M.D., Chief Medical Officer of Aurinia, said, Together with the supportive pharmacokinetic data, these findings add to the growing body of information available on voclosporin as an investigational drug that could provide an important treatment approach for people dealing with LN.

Both the AURA-LV and AURORA studies share the similar designed and were carried out in comparable patient populations. Subjects in both the studies were administered the recommended voclosporin dose of 23.7 mg twice daily or with matching placebo. The patient populations were pooled for an integrated analysis.

The data formed a part of the companys New Drug Application to the FDA. The regulatory agency has accepted the NDA and granted it the Priority Review status. The PDUFA target action date for the application has been set at January 22, 2021.

Analysis: Aurinia's candidate is targeting lupus nephritis, part of the systemic lupus erythematosus (SLE) market that was worth $1.87 billion in 2017 and estimated to reach $3.08 billion by 2025 at a CAGR of 7%. The company has a market capitalization of ~$1.97 billion on a price of $15.66, in a 52-week range between $4.57 and $21.93. 8 Wall Street analysts are very bullish and 2 are bullish with an average score of 4.8/5, and a price target of $25.10. Major shareholders are institutions and the public each with about 44% holding, with hedge funds, corporations and insiders holding 7.53%, 2.06% and 3.09%, respectively. The company has a debt of $6.2 million and cash balance of $264.35 million. Cash burn & cost of revenue were $23.7 and $52.9 million, respectively, in fiscal 2019, and $41.6 million and $56 million, respectively, in the TTM. The company estimates a revenue of ~$93 million in 2021.

Investment Thesis: With a strong development pipeline, the stock has strong future ahead. Currently, it is trading at considerable discount to its previous highs and may be good for initiating a position.

Aldeyra Therapeutics Inc. (ALDX) announced new data from the Phase 2 allergen chamber clinical trial of reproxalap ophthalmic solution in allergic conjunctivitis. The data did not show any safety or tolerability concerns. The company has advanced the 0.25% concentration of reproxalap to the Phase 3 INVIGORATE Trial.

The Phase 2 clinical trial was a randomized, double-masked, crossover, vehicle-controlled study. It involved 70 patients with allergic conjunctivitis who were evaluated over 3.5 hours in an allergen chamber of aerosolized ragweed pollen. Todd C. Brady of Aldeyra said, The new data presented at AAO this year further support the clinical utility of reproxalap, the first novel mechanistic approach in late-stage allergic conjunctivitis clinical trials in decades, as uniquely effective.

Both the dosage levels of reproxalap at 0.25 percent and 0.5 percent statistically significant and clinically relevant improvements in subject-reported ocular itching and tearing and investigator-assessed ocular redness. The data showed the prophylactic and treatment effect of drug. The time to event responder analyses showed the clinical relevance of the superiority of reproxalap over vehicle for ocular itching and ocular redness.

The Phase 3 INVIGORATE Trial is a randomized, double-masked, crossover, vehicle-controlled clinical and will evaluate the efficacy and safety of reproxalap 0.25% compared to vehicle using an allergen chamber. The primary endpoint of the trial will be subject-reported ocular itching score. Aldeyra is currently carrying out recruitment for the Phase 3 and the expects the topline data to be out in the first half of 2021.

Analysis: Aldeyra's ophthalmic solution will target an allergic conjunctivitis global market that was $2.5 billion in 2019 and estimated to reach $3.05 billion by 2027. Aldeyra has a market capitalization of $295.16 million on a share price of $7.64, which is near the 52-week high of $8.7. The company's 38.63 million shares are majorly held by the public with about 62% holding, whereas institutions hold about 36.5% and insiders about 1.5%. 5 Wall Street analysts are very bullish and 1 analyst is bullish giving an average score of 4.83/5 and a price target of $26.83. The company has a debt of $14.93 million and a cash balance of $56.19 million. Cash burn in fiscal 2019 was $56.5 million, while in the TTM it is $48.6 million.

Investment Thesis: The company is expected to provide updates about its different programs including COVID-19 treatment. These catalysts are expected to offer positive impetus to the stock.

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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Brainstorm Deal To Boost NurOwn, And Other News: The Good, Bad And Ugly Of Biopharma - Seeking Alpha