2023-03-08 08:50:15 ET
Summary
- Anavex seems to have effectively handled the Rett syndrome endpoint issues.
- A future publication should also throw more light on the AD data.
- The company is progressing well with its trials.
I covered Anavex ( AVXL ) on January 12, and my article was published a few minutes before - I think that was what readers said, but I can’t be sure - the JPM conference. I said therein that there are certain questions regarding AVXL’s Rett Syndrome trial as well as the more critical Alzheimer’s trial that merit responses from the company. I said I would like to see some of these questions answered at the JPM conference, and if they were answered, I would do a follow up article. It has been nearly two months since that time, and I would like to see if those questions have been answered by the company at any forum, or if they have otherwise been resolved.
About the Alzheimer’s questions, here’s what I wrote , following from an excellent article by fellow contributor C.C. Abbott:
Apparently, AVXL’s trial data presentation is full of errors, and these errors may change the positive conclusion they have drawn. First, there are random and small changes to the patient baseline data from slide to slide, however these changes can cascade into something that may impact the p-values. Second, there are basic math errors, simple errors in subtracting one number from another. Third, there are missing patient data, 9 in placebo arm and 37 in drug arm who are not accounted for. I recommend you to read Dr Abbott’s article if you want the scientific details. There are other, more tendentious criticisms - like whether they presented certain endpoint data and so on - which can have differing interpretations.
So, changes in data from slide to slide, basic math errors (these become glaring if you read Dr. Abbott’s article), missing patient data - these are the three datapoints I would like to see addressed.
For the Rett trial, there were two main criticisms - change in the primary endpoint, and a less foolproof area under the curve ((AUC)) endpoint than the previous one. My previous article covered this, where I said that the change in the primary endpoint seems to be standard fare, and because it was done when the data was still blinded, it seems to be above board. As to the propriety of the new endpoint itself, the company claimed it followed necessary guidelines, and also that it was more relevant. This is also something we should explore and see if there have been new updates.
In their latest earnings call, the company provided an update:
Going back to the Rett syndrome program, we announced recently on February 2 last week, the completion of enrollment of the randomized placebo-controlled EXCELLENCE Phase 2/3 study for the treatment of pediatric patients with Rett syndrome. We expect to announce top-line results from this study in the second half of this year.
This trial, according to the company, has exceeded the target enrollment by enrolling 92 patients.
There was an interesting question and answer between Yun Zhong of BTIG and Dr. Chris Missling, CEO at AVXL, about the AUC endpoint of this Rett study. Despite the difficult-to-understand text, I think what it says is that they have switched back to the RSBQ endpoint, not the RSBQ AUC endpoint:
Yun Zhong
Okay. And then switching to the Rett syndrome study. I believe though press release announcing over enrollment had the language that with the FDA's input, you are using the primary endpoint. So I wanted to confirm that the primary endpoint is RSBQ [AUC] and you see similar to -- or the same to the one used in the EBITDAR [AVATAR] study? And so has the FDA agreed that the AUC, the modified RSBQ scale can be an appropriate endpoint for Rett syndrome study?
Christopher Missling
Yeah. We have it described in clinicaltrial.gov, and it was also never change in clinicaltrial.gov for the EXCELLENCE study. It is the RSBQ primary endpoint, and the CGI is key secondary endpoint over the course of the trial.
Yun Zhong
Is that the same endpoint that was used in the AVATAR study?
Christopher Missling
Slightly different. So it's actually the measurement over time from beginning to end of trial. AUC.
Yun Zhong
Not AUC?
Christopher Missling
Not AUC.
Yun Zhong
Not AUC?
Christopher Missling
Exactly, yes. Because the study is large enough that it can carry the signal by itself without AUC.
This discussion also indicates why the company chose AUC at the last trial - that study was not large enough for RSBQ to “carry the signal by itself” without AUC. Note that the transcription does not get it at many places. Mr. Zhong’s question was whether the endpoint was RSBQ AUC, not RSBQ. For clarification, listen to the audio here - at around 12 minutes.
I have always felt - and said so before - that the two allegations for the Rett trial are raked up controversies. These are not real. The primary endpoints before used to be biomarker endpoints, and the trial was classified as a phase 2. Then Acadia started getting ahead, and enrollment was properly completed, so the company changed the trial to a phase 3. This is not unusual in the annals of biopharma. I have seen it a few times myself.
Along with the trial stage change, the company also changed the biomarker endpoints to more “registrational” endpoints, specifically RSBQ AUC. The difference between the traditional RSBQ and the RSBQ AUC is basically this; RSBQ is a questionnaire while RSBQ AUC is a statistical method of analysing the point data from that questionnaire. RSBQ AUC is more sensitive, and is especially useful to draw out differences in trials or short duration, where a trend from a simple plot chart may not be easily visible. Whether the endpoint is valid or good or not is for the FDA to ultimately decide.
The other accusation is the lateness of the change done; however, in my opinion, the company has explained that quite well. The change was done before data lock, so it could not have been done after seeing poor data; second, the explanation that the CRO delayed updating the clinicaltrials.gov website is familiar to people like us who follow the website regularly. Most things are hardly ever updated, and one can readily believe such an explanation. Indeed, like Missling says, one should not trust the registry too much, because of precisely this problem. It was supposed to be a great place for research, but regulator apathy and industry’s taking advantage of that has made the official registry a near waste of time. Very few companies even update results of trials there. Anyway, the point is, Missling’s explanation is, sadly, quite believable.
I think this resolves - at least for me - the controversy surrounding the Rett Syndrome trial. Although there are certain details that are difficult to understand, at least the accusation of malafide intent seems to be an unfair accusation.
As to the AD trial, there have been a number of questions raised, not all of which are readily quantifiable. I have identified three questions here which are quantifiable, and I looked for responses from management over these questions everywhere. I looked at JPM, and the earnings call, and a few other sources. Unfortunately, the JPM presentation does not contain any sort of discussion on the issues raised, and frankly, despite what many people said, I never expected it would because that is not the right forum to address a controversy. Neither does the earnings call. The management statement in the call was very basic. The CEO gave an interview to investors.com, which goes into some more details and answers the second of my three questions to an extent. It clarifies some of the so-called basic math errors, Dr. Missling basically saying that the way they have calculated for each individual patient is the right way to do it. The FDA will have the final say on that.
So then, the nearest term major catalyst for the company is the following:
On February 2nd, 2023, the Company announced completion of enrollment of the randomized, placebo-controlled EXCELLENCE Phase 2/3 study ANAVEX®2-73-RS-003 for the treatment of pediatric patients with Rett syndrome. Company expects to announce topline results from this study in the second half of 2023.
Financials
AVXL has a market cap of $770mn and a cash reserve of $143mn. General and administrative expenses for the quarter were $3.3 million, while research and development expenses were $12.1 million. At that rate, the company has cash for nearly 10 quarters.
Bottomline
AVXL is a stock that is up over 10x in the last 7-8 years. The company has a high short interest, and there’s considerable social media activity surrounding the company. Despite all sorts of allegations and accusations, Anavex has more or less quietly pursued its molecule’s trials in these dementia indications, and some of the trial data has been good. I would like to see it approach the final test - an advisory committee meeting that’s public and well-attended. That would resolve everything for most investors, and if the company has any value, it will also silence its critics.
For further details see:
Anavex: Many Questions Answered, A Few Still Left, But Things Are Progressing Well