Thursday, June 29, 2017

Minerva Neurosciences (NERV)

Minerva Neurosciences, is a drug development company addressing the unmet need of Schizophrenia, with a focus on the negative symptoms of the disease. The company will be entering a pivotal phase 3 clinical trial in the second half of 2017 with 500 patients from the US and Europe. A bit of history into their phase 2b clinical trial produced significant results from this press release Phase IIb study of MIN-101. The company solved three underlying issues that prevented them from being investment suitable. 

1. Raising capital with a 5M share offering at $7.75, announced yesterday, bringing total cash to around 118M.
2. Ran a Bridging Study with a BFB-520 metabolite improved MIN-101, and have filed for patent that could exceed 2035 expiration for the GR version.
3. FDA approved their design of the phase 3 pivotal clinical trial that should initiate the second half of 2017.

Quick Facts
Shares: around 41 million
Cash: around 118 million
MIN-101 MR patent:  2035
MIN-101 GR patent:  2035+

There is not an FDA approved drug specifically for negative symptoms of Schizophrenia. Minerva is now in the lead as far as clinical trials initiated with the start of this phase 3 scheduled for the second half of 2017. Thank you for reading.
                                            

Monday, June 12, 2017

Concert Pharmaceuticals Raises $30 Million in Venture Debt Financing

Announced today, Concert Pharmaceuticals has raised $30 million in a debt financing agreement with Hercules Capital. This deal looks good in that it is not dilutive, and carries a prime-based variable interest rate of 8.55%. There were minimal warrants tied into the deal in the amount of 61,273 at an exercise price of $12.24. With this capital raise, the company should have at the end of the second quarter (June 30th), around $100 million in cash. This sum excludes the potential for another $160 million when CTP-656 is officially sold to Vertex. The loan matures June 2021, about the time when AVP-786 could potentially be on the market, FDA approved for agitation of the Alzheimer's type. Thank you for reading.

Sunday, June 4, 2017

CNCE: Three Hurdles to Clear

Prior to Concert Pharmaceuticals advancing as a drug development company addressing unmet medical needs, a few hurdles first need to be cleared.

Sale of CTP-656 to Vertex
1. Sale of CTP-656 to Vertex for 160 million upfront and potentially 90 million in future milestones. Closing the transaction will happen after it's determined that the Hart-Scott-Rodino Anti Trust Improvements Act (FTC) clears the way. If the transaction gets blocked due to anti-competitive monopoly concerns, then the company will have to consider a capital raise sometime in 2017, for the advancement of CTP-543 in clinical trials. Should the sale go through, the company will have around $10.00 per share in cash on hand, and runway into 2021.

Suspension of Phase 2 for Alopecia Areata
2. The FDA has put a temporary suspension on CTP-543's phase 2 clinical trial for moderate to severe Alopecia Areata. The company will be forwarding non-clinical toxicology studies, required by the FDA before proceeding. Once the company forward's the studies, the FDA will then have thirty days to respond. The company is expecting to resume the clinical trial around August 1st. The FDA has exhibited zero safety concerns with CTP-543 at this time. This is a low hurdle event, that will just take time to clear prior to resumption of the phase 2 trial.

Ruxolitinib Patent Infringement Claim By Incyte Corporation
3. We first wrote here CTP-543 Patent Challenge By Incyte. Concert has stated on prior conference calls, that they have sought out a third party patent specialist, and believe that they have freedom to operate drug CTP-543 for Alopecia Areata. There will be a response period addressing Incyte's claim of obviousness in the next few months. The height of this hurdle is still undetermined at this time, but more clarity should occur in the next few months.

Bottom Line:
Drug development is never easy, and not for CNCE as noted above. I think #1, should be cleared late summer, and #2 should be cleared around August 1st. #3, is a longer process to determine the outcome. Thank you for reading.