Shares of Auris Medical $EARS zoomed up 40% yesterday and then came crashing down to the ground Thursday morning after the Swiss biotech reported that its lead drug for tinnitus failed to hit its co-primary endpoints in a pivotal Phase III study.
Instead of planning a regulatory filing, Auris will now have to start picking up the pieces from a study that failed to differentiate its drug from a placebo in eliminating the severe phantom sounds that afflict patients with tinnitus.
Its shares plunged 66% on the news.
Auris’s drug is dubbed Keyzilen (or AM-101). It’s an esketamine drug that targets NMDA receptors in the ear. The company had theorized that the damage to sensory cells that causes tinnitus could be treated by blocking cochlear NMDA receptors to suppress the “aberrant excitation of the auditory nerve that is perceived as tinnitus.”
There is another confirmatory study underway, but investors were skeptical that Auris can pull this out without being able to demonstrate success in both trials. Here’s Leerink’s Joseph Schwartz from a note this morning:
“Although we continue to expect the confirmatory portion of this study to mirror the results of TACTT2, this EU-based study includes an additional 300 patients being enrolled in Stratum B with post-acute stage of tinnitus of 3-6 months onset that will provide an additional shot at efficacy in a different patient population. The completion of a prespecified futility analysis in Stratum B based on 50% of the planned total enrollment in post-acute stage (3-2 months from onset) was assessed by the Independent Data Monitoring Committee (DMC) and led to the recommendation for continued enrollment, which is encouraging. Ultimately it remains to be seen how the FDA/EMA would consider Keyzilen if TACTT3 is successful in light of today’s negative TACTT2 results, as we expect that two successful pivotal trials are necessary for approval.”
There are other players in this field, including San Diego-based Otonomy $OTIC, which has its own NMDA antagonist in the clinic.
“We are disappointed that our TACTT2 trial did not reach its co-primary efficacy endpoints. The assessment of the trial data is ongoing and we intend to discuss outcomes and our plans for a path forward with regulatory agencies prior to the readout from the TACTT3 trial,” commented CEO Thomas Meyer.
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