A few years ago, when Vivek Ramaswamy bagged nelotanserin for his premier biotech startup Axovant in a small-money deal with Arena, the ex-hedge fund player touted the pact as a key move in his plan to become a leader in treating Lewy body dementia.
Today, the drug has joined Axovant’s Alzheimer’s drug intepirdine as evidence that Ramaswamy’s initial pipeline strategy was generally bad.
Axovant’s long suffering shares $AXON cratered, free falling 27% as investors swallowed another dose of failure.
Researchers say that nelotanserin blew the primary endpoint on a Phase II for patients with Lewy body dementia who suffer a sleep disorder. The best they could find were “trends in prespecified analyses of study diaries and certain sleep parameters on polysomnography.” And now they’ll ditch the effort altogether, throwing it in the same scrap heap where you’ll find intepirdine.
Nelotanserin has been in the headlines before. At the beginning of the year, when Axovant and Ramaswamy were trying to find something good to say about the pipeline, they pointed to a positive p-value for a subset of Parkinson’s patients — only to shamefacedly admit soon after that they had miscalculated their figure.
Axovant has now wiped the old slate clean, starting over again with a new pipeline and a new executive crew — after David Hung and his entourage split soon after the Alzheimer’s trial flopped.
Their stock dropped 27% Monday morning. Before the plunge, their stock had traded well above $20 a share. It’s going to start the day with a market open of around $1.20.
To be fair, Ramaswamy doesn’t do many deals like the ones he struck early on. Ramaswamy founded his umbrella company Roivant on the idea that he could pick up drugs left on the shelf in the industry with small upfronts. More recently, as his fundraising pushed past the $3 billion mark, he’s upped the ante considerably.
At 0-for-2, Ramaswamy needs a win on the data. And he has the money to get there with his growing stable of Vants — provided he’s now better at picking drugs.
Vivek Ramaswamy at the US-China Biopharma Innovation and Investment Summit in Shanghai on October 23, 2018. Endpoints News, PharmCube
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