Novan’s shares in meltdown following “discordant” PhIII studies of a new acne drug

Nathan Stasko, Novan

Officially, Novan $NOVN put out some mixed data from two Phase III studies of their lead drug for acne, with one success and one failure. But even the positive data from one trial failed to stand out from the control arm in a major way, putting this company under a cloud.

Its stock plunged 80% this morning.

On the up side, investigators say that SB204 hit all three co-primary endpoints for NI-AC302, with significant – though far from impressive – results for reducing the number of lesions and acne clearance. Here are the numbers, for both studies:

•The absolute change from baseline in the number of non-inflammatory lesions in NI-AC301 was -15.4 for SB204 and -13.4 for vehicle (p=0.030), and in NI-AC302 was -14.9 for SB204 and -12.3 for vehicle (p=0.001).

•The absolute change from baseline in the number of inflammatory lesions in NI-AC301 was -12.1 for SB204 and -11.1 for vehicle (p=0.114), and in NI-AC302 was -12.9 for SB204 and -10.6 for vehicle (p<0.001).

•The proportion of patients with IGA success in NI-AC301 was 13.4% for SB204 and 13.8% for vehicle (p=0.866), and in NI-AC302 was 18.9% for SB204 and 14.3% for vehicle (p=0.032).

A total of 2,639 patients ages 9 and older with moderate to severe acne were enrolled across a total of 110 sites in the United States.

The secondary endpoints looked quite similar, leaving Morrisville, NC-based Novan counting its cash. There’s enough money on hand to make it through the end of the year, when it’s hoping to have some better data from an upcoming readout on an anti-fungal program.

Novan raised $45 million with its IPO last fall, earmarking the money for an NDA for this drug, which it billed as the first new chemical entity to come along for acne in 20 years. Those plans may well have to change now. The biotech ended the day yesterday with a market cap of $298 million.

“While we are pleased with the results of the NI-AC302 trial that met the regulatory requirement for statistically significant efficacy of SB204, we are disappointed with the discordant results of NI-AC301. Our team has not yet received the full data set and we intend to provide an update on the SB204 program after our complete analysis,” said Nathan Stasko, PhD, President and CEO of Novan. “Despite these discordant results, we believe in the potential of nitric oxide’s multiple, well-documented mechanisms of action and the data we have recently generated for our SB206 anti-viral and SB414 anti-inflammatory product candidates. We continue to look forward to near term clinical results from our SB208 anti-fungal program in the second quarter of 2017 and advancing our pipeline of innovative therapies for patients suffering from skin diseases.”

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Research Scientist - Immunology
Recursion Pharmaceuticals Salt Lake City, UT
Director of Operations
Atlas Venture Cambridge, MA

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