Amylyx: May Redeem Itself With Data Readouts And Possible GLP-1 Acquisition (NASDAQ:AMLX)

tiratus phaesuwan/iStock via Getty Images Amylyx Pharmaceuticals, Inc. (NASDAQ:AMLX) suffered a major setback this year when it voluntarily delisted its Amyotrophic lateral sclerosis [ALS] drug Relyvrio on April 4th of 2024. This was a huge blow to the company, definitely, but that doesn’t mean that it doesn’t have some opportunities to redeem itself in the coming years. What I’m talking about is that it is using AMX0035 for other indications. This particular drug is being developed to treat patients with Wolfram syndrome and progressive supranuclear palsy [PSP]. Data from each of these programs are expected to be released in the fall of 2024 and mid-2025, respectively. Not only does AMLX have the opportunity to redeem its pipeline targeting these two indications, but it also has the possibility of doing well again in targeting patients with ALS. It expects to initiate a phase 1 study of AMX0114, which is a potent antisense oligonucleotide targeting Calpain-2, in the 2nd half of 2024. It remains to be seen if this ends up being successful, but at least it gives this biotech another shot at goal for the large ALS market. Lastly, another possible positive would be an agreement that was signed with Eiger BioPharmaceuticals, Inc. (OTC:EIGRQ). This is where Amylyx would acquire the rights to use this company’s phase 3 ready GLP_1 receptor agonist, known as Avexitide. However, this will only be possible if the Texas Bankruptcy Court approves such a transaction. Relyvrio Being Pulled From The Market For ALS Was A Setback, But A New Possibility Emerges As I noted above, Relyvrio for the treatment of patients with amyotrophic lateral sclerosis [ALS] was pulled off both the United States and Canadian markets. The reason why such voluntary delisting was done on April 4th of 2024 was because of poor results released from the ongoing phase 3 PHOENIX trial. In this study, Relyvrio failed to beat the placebo regarding the primary endpoint, which was ALS functional Rating Scale-Revised [ALSFRS-R] score. Matter of fact, the p-value reached was not statistically significant, with a p-value of p=.667]. Amyotrophic lateral sclerosis [ALS] is a progressive motor neuron disease where the nerve cells of the brain and spinal cord are affected. It results in the loss of muscle control, which in turn means that patients cannot perform daily activities. It’s unfortunate that Relyvrio was pulled off the market because there were only about three therapies available beforehand for these ALS patients. With only one of the approved drugs extending survival by a few months. Consider that only approximately 50% of patients diagnosed with ALS live at least 3 or more years after receiving their diagnosis. This greatly declines as the years go on, where only 10% live more than 10 years afterward. Not only is it sad that the ALS community now only has a few treatment options, but it is not ideal for Amylyx since it loses out on this considerable market opportunity. Consider that the global amyotrophic lateral sclerosis market size is expected to reach $1.27 billion by 2033. However, this is where some good news comes into play. That’s because this biotech is in the process of advancing another drug for these patients, known as AMX0114. This is an antisense oligonucleotide being developed for the treatment of patients with ALS. A catalyst opportunity is possible for investors here because it is expected that it will begin a phase 1 multiple-ascending dose [MAD] study using this drug to treat this patient population in the 2nd half of 2024. The goal is to specifically target calpain-2, which is known to cause axonal degeneration of the nerves. Thus, an effective treatment option would be to reduce cell death as much as possible and preserve function for these patients. It remains to be seen what ultimately happens in the phase 1 MAD study, but it is good to see that the company is not entirely giving up on its path towards finding an effective therapy for these patients. AMX0035 Has Two Shots On Goal To Possibly Boost Shareholder Value The potential for Amylyx to recover with the use of its antisense oligonucleotide AMX0114 in a phase 1b MAD study is only one possible way it could redeem itself. Having said that, it is advancing AMX0035 for two other patient populations. Despite Relyvrio not working in treating patients with ALS, it is possible that it might help treat patients with Wolfram syndrome and progressive supranuclear palsy [PSP]. The thing is that AMX0035, like Relyvrio, is composed of sodium Phenylbutyrate [PB] and Taurursodiol [TURSO, also referred to as Ursodoxicoltaurine]. Wolfram syndrome is an inherited disorder that causes childhood-onset insulin-dependent diabetes mellitus and progressive optic atrophy. Thus, a major problem of this disorder would be high blood sugar [glucose] levels and progressive vision loss because of nerve damage in the eyes. It is said that a mutation of the WFS1 gene is responsible for causing more than 90% of Wolfram syndrome type 1 cases. Other problems that these patients can experience are deafness and balance/coordination problems as well. There are no currently approved therapies for this disorder, which makes it a highly ideal target indication. The only things that these patients have are life-sustaining medications and managing their symptoms as best as possible. The function of sodium phenylbutyrate is to reduce the amount of free-roaming mutant proteins causing the disease and restore normal insulin secretion. The goal of Taurursodiol is to inhibit mitochondrial dysfunction. The thing is that this biotech already released some positive interim data from the ongoing phase 2 HELIOS study, which used AMX0035 to treat this patient population. This interim data released, included 8 patients who were given this drug. It was noted that all 8 patients had met the ability to display either stabilization or improvement of disease according to two different scale evaluating measures, which were Patient Reported Global Impression of Change [PGIC] and the Clinician Reported Global Impression of Change [CGIC]. Amylyx wants to meet with the FDA based on this interim data to discuss a possible pathway forward in terms of the regulatory front. However, a catalyst that investors can expect is full clinical data from this phase 2 HELIOS trial using AMX0035 to treat this Wolfram syndrome patient population, in the fall of 2024. The other disorder being targeted with the use of AMX0035 is known as progressive supranuclear palsy [PSP]. This disorder is characterized as a neurological disorder that affects the body’s movements, such as walking and balance. What happens with this disease is that nerve cells in the portion of the brain where movement is important are damaged. PSP has some similar symptoms such as Parkinson’s Disease [PD], but is different. Within about 3 to 5 years of diagnosis, it is said that severe disability is present. Why attempt to target patients with PSP? That’s because this neurological disorder has ER stress and mitochondrial dysfunction as well. Not only that, but in a phase 2 randomized placebo-controlled trial targeting Alzheimer’s Disease patients, AMX0035 was shown to reduce CSF tau. In terms of a catalyst for this program, it is expected that an interim analysis of the ongoing phase 3 ORION study is expected to be released in mid-2025. The primary efficacy measure in the change in total Progressive Supranuclear Palsy Rating Scale [PSPRS[ score over a 52-week period. The score will be between “0” to “96,” with the higher score indicating more progressed disease. Possible GLP-1 Addition Might Add Value If Everything Aligns Correctly The potential to advance AMX0114 for ALS and then AMX0035 for Wolfram syndrome plus PSP is set in place. However, the company has found another possible path of attempting to generate shareholder value. This would be with the deal it has signed with Eiger BioPharmaceuticals, where it would acquire rights to a phase 3 ready GLP-1 asset known as Avexitide. The thing is that this asset is likely to be used to target patients with obesity. It is expected that the global obesity market could reach $77 billion by 2030. However, this will not be easy for Amylyx to pull off, and this is because of all the competition in this space. Thus, not only must Avexitide be successful in clinical testing, but has to have differentiating factors to set it apart from the other weight loss drugs currently in clinical testing or approved. To obtain a license agreement to advance this drug, it had agreed to pay $35.1 million plus other payments. I believe that a path forward here would likely not only entail successful advancement of Avexitide as a GLP-1 drug, but the ability to combine it with another drug. The reasoning for this would be to generate a substantial improvement in weight loss compared to other GLP-1 drugs. The problem is that in order for Amylyx to obtain Avexitide there must be other stipulations achieved beforehand, including the bankruptcy court of Texas allowing it to happen. Financials According to the 10-Q SEC Filing, Amylyx Pharmaceuticals had cash, cash equivalents, and short-term investments of $373.3 million as of March 31, 2024. It believes that it has enough cash on hand for a cash runway to fund its operations into 2026. This will be enough cash on hand to get it through several of the milestones I listed above, and there should be no risk of near-term dilution because of the cash projection. Especially, since it no longer markets Relyvrio for ALS because of the voluntary delisting. Its cash burn was extreme because of the marketing of this drug, but going forward it should decrease substantially. For the first quarter ending March 31st of 2024, its cash burn was $94.4 million. Risks To Business There are several risks that investors should be aware of before investing in Amylyx Pharmaceuticals. The first risk to consider would be regarding the development of AMX0035 for the treatment of patients with Wolfram syndrome and PSP. Results from each of these programs being targeted are expected to be released in the fall of 2024 and mid-2025, respectively. Upon release of data, there is no assurance that this drug will be able to effectively treat either of these patient populations. In light of Relyvrio not being effective for ALS and being pulled off the market, there is some risk involved with these two other advancements. A second risk to consider would be the development of antisense oligonucleotide AMX0114 for the treatment of patients with ALS. It is expected that an IND filing, to advance a phase 1 MAD study using this drug to treat this patient population, will happen in 2024. There is no guarantee that the FDA will accept this regulatory filing and that a “green light” will be given by the agency to initiate such a study. Secondly, even if such an early-stage study is started, there is no assurance that the final results to be released from it will turn out to be positive. The third and final risk to consider would be in terms of the deal that was signed by Amylyx Pharmaceuticals to acquire rights to use the phase 3 ready GLP-1 asset Avexitide. The thing is that there are two things to worry about here. The first of which is that there is no assurance that the company will be able to obtain this drug. That’s because there are other stipulations that have to be met first, including the Texas Bankruptcy Court allowing such an acquisition of rights. The second item to be concerned about would be in terms of successfully advancing this drug in the clinic as a GLP-1 agonist. There is no guarantee that the trials to be done will yield positive results. Nor, Avexitide will ultimately be strong enough to counter competition in this space. Especially, when you consider that so many companies are already testing the use of combining their GLP-1 drugs with other weight loss drugs, for example, GIP receptor agonists. The purpose of this is to greatly enhance the amount of weight loss achieved with such combinations. Conclusion Amylyx Pharmaceuticals has done well to recover from the need to voluntarily withdraw Relyvrio for the treatment of patients with ALS from both the U.S. and Canadian markets. It is already gearing up to release data readouts from two studies using this very same drug, AMX0035. One of the data readouts, expected in the fall of 2024, will be with using this drug to target patients with Wolfram syndrome. Then, the other data readout expected in mid-2025 is going to target patients with progressive supranuclear palsy [PSP]. It is not clear if this drug will be able to perform better here, compared to the outcome that was achieved in targeting patients with ALS, but it is at least worth a shot. I believe that there is a promise that at least this biotech has another crack at attempting to target patients with ALS using an antisense oligonucleotide, known as AMX0114. The only major downside is that a phase 1 MAD study using this drug for the treatment of this patient population, is not expected to happen until the 2nd half of 2024. Plus, it remains to be seen if the IND filing of this drug is accepted by the FDA and the company receives a green light to start such an early-stage study. With a few data readouts expected within a 1-year period, plus the ability to target the large ALS market again, I believe that investors could benefit from any potential gains made. Editor’s Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.

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