Results

Axovant’s lead Alzheimer’s drug flops in PhIII, ending an unlikely quest

Vivek Ramaswamy burst onto the biotech scene a few years ago with a brash plan to grab a failed drug from GlaxoSmithKline and hustle it straight into a pivotal Phase III study for Alzheimer’s — a disease that has defeated every pivotal shot taken at it over the past 15 years.

But intepirdine, like every other Phase III Alzheimer’s study, failed. And this failure for Ramaswamy’s Axovant will likely kill 5HT6 as a target in Alzheimer’s after several other studies with the same target also flopped over the past year.

The news quickly crushed Axovant’s share price, sending it down more than 70% and wiping out $1.8 billion in market cap in seconds as investors reacted to one of the biggest catalysts of the month.

Researchers said that the drug failed both co-primary endpoints, unable to significantly improve cognition or function for patients relative to placebo. The key numbers: ADAS-Cog (0.36 points, p=0.22) and ADCS-ADL (0.09, p=0.83).

The company is sticking with top-line data for now, planning to outline more of the specifics at an upcoming conference. But in a call with analysts Tuesday, Axovant CEO David Hung made it clear that the drug combined with donepezil failed badly.

“There was no difference between the intepirdine and the placebo arms,” said Hung, and the Alzheimer’s program is finished — though the company plans to pursue its work on dementia with Lewy bodies.

The failure here will come as no surprise to longtime investigators in the field. Pfizer and Lundbeck had both tried and failed to amp up cognition with a 5HT6 program, designed to spur release of a neurotransmitter, though Axovant insisted that it could beat the odds.

If it had, analysts agreed that a new drug now could be worth billions in annual revenue. Instead, the drug hasn’t proven it’s worth the $5 million Ramaswamy paid for it.

“While we are deeply disappointed by these trial results, we also are saddened for the millions of patients and families impacted by Alzheimer’s disease. However, we believe that the fight against Alzheimer’s and other important areas of unmet need in neurology is too important to be derailed by this setback,” said Hung in a statement.

While the drug cost only a few million up front to license, the 32-year-old Ramaswamy quickly steered Axovant $AXON into a record-setting biotech IPO on this drug, on his way to gathering close to $2 billion to back a multi-faceted enterprise that has grown rapidly. He was able to recruit CEO Hung to take the helm not long after Hung completed the deal of a lifetime in selling Medivation to Pfizer for $14 billion.

For Hung, it was a chance to take another shot at Alzheimer’s, a disease that had defeated one of his candidates at Medivation.

Ramaswamy had insisted that this drug would prove different, pointing to trial data that showed a path forward. Intepirdine was his first test of a business model that depends on gaining access to drugs on the shelves at the world’s biggest pharma companies. But that model faces fresh questions this morning as Axovant and the parent company — Roivant — deal with a bitter setback.

Roivant put out a statement this morning pointing to all the other drugs now in its multiple pipelines. Axovant, the company noted, will continue to investigate new drugs for the memory wasting ailment, just as it will continue to go after other drugs. And without attribution, the company says it will persevere.

Some of those efforts will succeed. Others will fail. We owe it to patients to take those risks, and we remain undeterred in pursuing our mission.


Image: Vivek Ramaswamy Getty, David Hung File Photo


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