A Momentary Lapse of Reason*

*Floyd, P.  1987

Every now and then, pharma/biotech companies do things that suggest that they had experienced a transient ischemic attack against their better judgment. Today there were two such events in the news:

1) Biogen-Idec and BIIB037

Biogen-Idec is one of NIR’s favorite companies,  they have planned and executed better than almost anyone else in the neuro area. So when they make errors, those mistakes  perhaps are magnified by the contrast with the Company’s usual high standards. First, they disclosed vague but intriguing results for this monoclonal antibody against an undisclosed epitope of beta-amyloid, stating that patients after 54 weeks of treatment showed decreased plaque load and improved cognition.They are sufficiently impressed that they plan to now go directly into Phase III from a trial that was originally, but not entirely honestly, labeled as a Phase I.

Today’s news involved a few frontal function lacunae: Our first comment is that this news came at a presentation at the Deutsche Bank BioFest investment conference, and was not accompanied by a corporate press release; company spokespersons only made further comments in response to press inquiries. This is selective disclosure of material information, and if anyone doubts that it is material, note that the Market added $5 billion to Biogen-Idec’s market cap today, which qualifies as material in our view. Secondly, in their public description of the trial, Biogen-Idec had disclosed only plans to assess biomarkers; scans of AB plaques, blood levels of antibodies. Now, it turns out that they were also conducting cognitive testing of some kind, which means they had withheld relevant information about the trial protocol. It should be beneath Biogen-Idec to play petty games with this kind of information.We are also unimpressed with their plan to not disclose the full data until a conference sometime in 2015. Private companies can get away with delayed disclosure, but a public company, with this much riding on skimpy and selective disclosure  should not. Perhaps the analysis is not yet complete, but they do have more detail that could have been provided– What were the cognitive testing results that inspired a Phase III go decision? What was the actual rate of vasogenic edema in APOE4 patients, in non-APOE4 patients?

Finally, and this is more ambiguous, we always have a moment of vertigo when a company skips doing a real Phase II and just goes directly into a several hundred million dollar Phase III in Alzheimer’s, particularly when they cite beta-amyloid plaque reduction as a key biomarker finding. It has  not worked out well in the past, and while Biogen-Idec is in good company (e.g. Merck, Lilly/AstraZeneca, Roche) in choosing to shave off two or three years off the development timeline, the added risk is not to be dismissed. That’s a judgment call in terms of risk-benefit, whereas the first three issues, the informational omissions, are not judgment calls, they were mistakes.

2) Otsuka is buying Avanir for $3.5 billion

Someone’s lithium level needs to be checked. By the press coverage, one would think that Avanir possesses some kind of broad and deep neurology pipeline that would complement Otsuka’s psychiatry assets. They do not, they mainly have Nuedexta, the quinidine-enabled version of dexmethorphan, and while Adam Feuerstein’s (Street.com) denigration of Nuedexta as ‘cough syrup’ is overly harsh, Avanir’s  deepest expertise is in clinical testing in a plethora of disorders, as they have done with Nuedexta (aka AVP-923) and its deuterated cousin, AVP-786. The recent Phase II data in Alzheimer’s agitation was intriguing, the first time that Avanir has presented something that approximates a real opportunity. But their Nuedexta sales, with pseudobulbar affect the only approved indication, just reach $100 million annualized. The Optinose sumatriptan product that they acquired this year looks distinctly unpromising to us, and the FDA was less than enthused, rejecting the NDA.

How does this translate into $3.5 billion? In our opinion, it does not, the valuation had already become prematurely inflated post-AD data, and this just takes it to ‘could this be a sign of a bubble?’ proportions. If Otsuka, which has had a strong record in psychiatry, wants to become a significant player in neurology, there were several cheaper, deeper, better routes to that end. To the media outlets who issued half-witted headlines like “Are Avanir Shareholders Getting Enough in the Buyout?”, we can only say that when Christmas comes early, it’s greedy to ask why Santa didn’t throw in a Lamborghini for good measure.


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Neuren’s Phase II Success in Rett Syndrome

Neuren’s NNZ-2566 is a program that NIR has been following for more than a decade. NNZ-2566 is a small molecule analog of Glypromate, which itself is the synthetic version of an IGF-1 subunit. Long focused on TBI (with PhIIb data due next year),   reports of impact in MECP2 model mice led to a Phase II trial of NNZ-2566 in Rett Syndrome, with possible mechanisms including the spurring of dendritic growth, reduction of microglial activation, attenuation of apoptotic gene expression, and inhibition of inflammatory cytokine production.

Neuren has just reported the results from that 53 pt PhII trial, which enrolled Rett patients between the ages of 16 and 45, treating them for four weeks. Given the chronicity of the condition, and the brevity of treatment, the odds against a clear signal were quite high. But compared both with the placebo group and based on intra-subject changes, three outcome measures showed benefit, based on both physician and caregiver ratings, the other three showed the equally vital outcome of no deleterious effects. The p value was .023.

Admittedly, this was a small and short-duration study, but given that there is nothing at present that addresses the core pathophysiology of Rett Syndrome, a devastating neurodevelopmental disorder that often leaves its (exclusively female) patients unable to speak or walk (20,000 or more Rett patients in the US), this evidence of a signal is  encouraging. It constitutes something more than a Hint of Concept, but not quite Proof, the latter will require a larger study and one that tests the drug in a younger population. But in a younger population, there may also be an opportunity for a more robust impact as well, given that the progressive loss of function might be arrested at an earlier stage. This is a welcome instance of a Company that persevered for many years in obscurity, for whom the investment of time and resources may have finally paid off.


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Earning It

They make money the old fashioned way. They earn it.“–Houseman, J.,    Barney, S.  1979

The news that AbbVie is pulling out of its arranged marriage with Shire Pharmaceuticals (because tax law revisions are changing the value of inversion deals) broke yesterday, much to the consternation of the hedge funds that had piled in, seeing this as an easy, indeed lazy route to riches. Similar to the thinking of the principals, whose corporate strategizing was oriented to loopholes rather than the generation of true value.

Good. Having been unable to muster much in the way of corporate creativity or courage on a voluntary basis,  both companies, but particularly Shire, will have to find some in the wake of this change of plan. Reportedly, AbbVie has to pay a breakup fee of US$1.6 billion to Shire for having called off the nuptials. After Shire pays off its legal and banking advisors, that should leave at least a couple hundred million that they could invest in something useful, like drug discovery and development. Having made a fortune in psychiatry via its ADHD franchise (Vyvanse, Adderall, Intuniv), Shire had subsequently built absolutely nothing of value in CNS, indeed they had retreated and regressed. Now, Shire has another shot, using AbbVie’s money. Via licensing/acquisitions, they have the opportunity to make money the old fashioned way–they can earn it.

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Alcobra’s Selective Inattention

Last week, in the October issue of NeuroPerspective, which covered ADHD, we noted the delay in Alcobra’s disclosure of Phase III data for MDX (metadoxine), and stated “ our suspicion is that the analysis of the primary and secondary endpoints for the overall patient population was negative, and that they are seeking evidence of benefit
in the ‘Primarily Inattentive’ subgroup in order to salvage something positive from a failed trial.” This turned out to be at least partly accurate, since they have not yet reported anything on secondary endpoints, but they are indeed working hard at the salvage process.

Basically, the results of the primary endpoint analysis was that the trial failed–though Alcobra termed the obtained p=.15 as a ‘trend’, which is generous, we generally reserve ‘trend’ for that grey area between .05 and .10. However, their emphasis was on a posthoc analysis that excluded four patients in the Combined Inattentive/Hyperactive subgroup who had received placebo, but shown dramatic ‘improvement,’ to an extent that pointed to invalid responses. Removing those four led to a change in the reported value, to p=.03, which is somewhat astounding in itself. This raises the reasonable question of whether the trial failed or the drug failed–it is one or the other.

Unfortunately, Alcobra doubled down on a selective emphasis upon the perceived nuggets of value in the trial, and did not adequately attend to the wider spectrum of implications:

1) Three of the four outlier placebo patients came from the same US site. Alcobra did not break out how many of the trial patients in total came from that site, but we would suggest that it is self-serving to just exclude the dramatic placebo outliers. Invalid inclusion and/or response patterns could be the case for some of the patients who received MDX, whose improvement might not be nearly as much of an outlier compared to historical drug-responders. Alcobra would likely state that since the overall change in the drug group was similar to previous testing, and it was the placebo group that diverged, that the problem is in the latter. Unfortunately, that cannot be safely assumed: If, for example, additional ‘ATM patients” entered the trial at that site and were not screened out, there is no reason to assume that all fraudulent patients received placebo, and that less dramatic improvement in the drug group can be safely attributed to MDX, not patient fakery.

2) Which means that there is absolutely no reason to think that the FDA is going to accept this as one of the two required pivotal trials. Alcobra’s statement that the FDA looks at the “totality of the data”, as if they might set aside those four patients, denies regulatory reality (e.g. Neurocrine Biosciences‘ first Phase IIb in Tardive Dyskinesia, where one site’s onsite ratings had zero congruence with the video ratings–Neurocrine still had to run another Phase IIb, they did not get the go-ahead to enter Phase III based on overtly distorted Phase IIb data). Alcobra kept saying that they would meet with the FDA to assess their next step: The next step would be to run another Phase III trial, while assuming the requirement of a second. Meeting with the FDA would offer the opportunity to finetune the protocol and enrollment criteria to reduce the risk of this being replicated, but not the necessity of repeating the trial.

3) Alcobra’s conference call began with the statement that they would ‘start with the bottom-line’–that the trial results support MDX as providing clinical effect in Adult ADHD. We would disagree: While the results do not prove the converse, that it does not have beneficial effect,  a failed Phase III whose data are suspect does not establish benefit. Their emphasis on finding positive trends in the Combined Inattentive/Hyperactive subgroup where none had been seen before, might reflect the greater statistical power of this larger sample, but given that all of the identified outliers came from that group, we would suggest that some other patients in that category may have received drug but also responded fraudulently.

Alcobra needlessly undercut its own credibility with its press release and conference call, where they selectively inattended to negative ramifications of the dataset as it currently stands. The stock sell-off, of over 50%, reflects disappointment with the results, but also with the spin operation that ensued: One fund manager told me he thought the press release was “disgusting” in its flagrant denial of trial failure, he clearly was not alone.

Metadoxine is not finished, but its all-Israeli pediatric ADHD PhII data due late this year will not undo the damage done, and Alcobra’s management should consider a reset of its PR stance, which cost their credibility dearly.

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The Flying Dutchman sets course for an IND

<<The Flying Dutchman is a legendary ghost ship that can never make port and is doomed to sail the oceans forever. >>  –Pedia, W.

Last November, a disspiriting diaspora of neuro talent from Bristol Myers Squibb  began when BMS decided to disband its CNS research group; hence considerable surprise back in April, when the Ghost Ship signed its iPierian deal, acquiring that Company and its tau antibody program for $175 million upfront, and promises of much more later. But given that there are tauopathies that fall under the Rare Disease category, that seemed the probable angle for understanding a deal that was CNS-based, from a company that had seemingly chosen to exit the brain.

But today, it was announced that BMS is advancing a NR2B antagonist candidate molecule that had been developed within its ‘fully internalized’ alliance with NeurOp. They will be preparing the compound for its eventual IND, in psychiatry, aimed at Treatment-Resistant Depression. Which is not a rare disease.

One can only imagine what would be possible if they hadn’t made most of their crew walk the plank.

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‘Google’s War Against Aging’ (WSJ 9/4/14)

The announcement that Google‘s Life Science spin-off Calico LLC is joining up with AbbVie in an anti-aging R&D effort into which each will put an initial investment of $250 million (and up to half a billion more each) raises some interesting issues and questions. In no particular order:

1) The two major foci cited are neurodegenerative disease and cancer, which gives CNS the kind of high profile that has been missing from several Big Pharma companies. It was somewhat amusing, in a black-humored way, that the WSJ reporters stated that “the drug industry has had a mixed record in its efforts to significantly improve treatment for neurodegenerative diseases such as Alzheimer’s and Parkinson’s.”  Mixed? The drug industry aspires to eventually have a ‘mixed record’, currently the more accurate adjectives include candidates like ‘abysmal’ and ‘horrific.’ Calling it ‘mixed’ is like saying that Vladimir Putin has a ‘mixed’ record when it comes to humility.

2) Entering into a 50/50 partnership with AbbVie is an interesting choice on Calico’s part–and on AbbVie’s, given that their history is one of ‘not playing well with others.’ Calico is not being managed by lightweights, so AbbVie’s penchant for control rather than collaboration is going to undergo a cultural stress test. On the other hand, both Calico and AbbVie have the reputation of being quite secretive, so we expect to hear very little of substance for a very long time. The rumor that AbbVie employees are required to have cyanide fillings that can be remotely-activated if they say anything of informational merit remains just that, a rumor.

3) If  the ‘War against aging’ is operationalized as a life-extension campaign, it may be a misguided goal. While we stand with our Boomer peers in claiming that the Boomer generation is a very special generation that deserves immortality; from a Millennial resource-allocation viewpoint, extending life chronologically would be an unwelcome development. In NeuroPerspective‘s review of Alzheimer’s, we noted that “Success in delaying that (Alzheimer’s) onset…may delay the advent of incapacitating dementia symptoms for a significant portion of the at risk population towards, or beyond, the end of life. If the process can be slowed, fewer people will outlive their functional capabilities, saving them and the society within which they live from the indignities and costs of severe dementia… This assumes, of course, that modern medicine does not further complicate the task by extending the average lifespan beyond its current point, an assumption that may be more safely rooted in the inevitable shift towards the actuarial allocation of finite medical resources, than upon any retreat on the part of medical science itself.”

In other words, extending independent functioning is likely to be a reasonably good thing, extending life span might not be…

4) Finally, the sheer scale of the AbbVie/Calico endeavor has some advantages, but has a potential downside. They will have the resources to attract scientists from almost anywhere, which could put some small-scale, independent R&D projects in jeopardy, as their initiators/sponsors are recruited to Calico tasks. A sidebar in the September issue of NeuroPerspective noted that the hyperconsolidation of resources in a few entities and geographic areas risks losing creativity and innovation–and this is another example of a situation where scale may be counterproductive.


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The Golden Age of Neuroscience

We were surprised and thrilled, as so many were, to find out from the Wall St Journal that the “Golden Age of Neuroscience Has Arrived” (Michio Kaku, 8/20/14). We hadn’t even received an email alert. Apparently, we are now able to “mentally control appliances, surf the Web..control a distant robot or avatar, and even drive a car.”  That is welcome news for NIR, because we have had a very difficult time controlling our avatars manually, let alone operate our Miele dishwasher beyond the one cycle that we understand (‘Turbo’). Kaku went on to say that “one short-term research goal is to create a “brain pacemaker” for Alzheimer’s patients. By pushing a button, a person might be able to remember where they live…” That’s the shortterm goal.  And the longterm objectives? For one, Kaku suggests that “the Internet might be replaced by a Brain-Net, in which emotions, sensations, memories, and thoughts are sent over the Internet….. Instead of using clumsy symbols like :), teenagers would go crazy sending all their adolescent emotions and feeling on a mentalized version of Facebook.” Besides the inevitable bandwidth issues, Kaku overlooks the fact that it is the necessity of using symbols, and occasionally language, that provides teenagers with a paper-thin buffer between their impulses and actions, allowing them to mimic the mediating effect of a not-yet-fully-connected frontal lobe. The spectre of an unfettered flood of adolescent angst and lust permeating the communal ‘Brain-Net’…that’s not a Golden Age, it’s Dante 9.0, a new Circle of Hell. And Kaku’s forecast of a “day when we might wake up and watch a video of the dream we had the previous night” is unappetizing: CNS Summit. Keynote address. No pants. Again.

But we are not going to dwell on these less photogenic images of the new Neuro World. After all, Kaku is a professor of theoretical physics, a discipline whose panoply of invisible and incomprehensible subparticles makes the DSM-5 seem evidence-based by comparison. He may have misread a few quarky details here and there. We prefer to focus on his inspirational closing thoughts, one of which was this: “the promise of this new revolution in neuroscience is profound, holding out the ability to someday alleviate suffering and enhance our true mental potential.” Finally. The Golden Age is here. Somebody call GSK and Bristol Myers Squibb. Our avatars say that it’s time to turn the CNS lab lights back on.

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