Summary
- BioXcel Therapeutics is a biopharmaceutical firm based in Connecticut that develops therapies for central nervous system and immuno-oncology disorders.
- Its lead products are IGALMI and BXCL701, with IGALMI having received FDA approval.
- IGALMI is a sublingual thin film formulation of dexmedetomidine indicated for the treatment of acute agitation associated with schizophrenia or bipolar I or II disorder in adults.
- The market for the treatment of acute agitation is saturated and includes many drugs that have been in use for years, which presents a challenge for IGALMI as it does not offer unique benefits or differentiation over existing drugs for agitation.
- IGALMI is unlikely to be successful due to limitations in real-world applicability and safety concerns. Investors should not assign value to it.
Introduction
BioXcel Therapeutics ( BTAI ) is a biopharmaceutical firm located in Connecticut, United States. The company's objective is to market and develop therapies for the treatment of central nervous system and immuno-oncology disorders. The company, established in 2017, aims to enhance patient outcomes by, supposedly, utilizing advanced technologies, such as artificial intelligence and machine learning, to identify new drug candidates and optimize drug development.
The company has two lead products. IGALMI , which achieved FDA-approval last year, is a sublingual thin film formulation of dexmedetomidine indicated for the acute treatment of agitation associated with schizophrenia or bipolar I or II disorder in adults; and BXCL701 , an oral small molecule inhibitor of dipeptidyl peptidases for small cell neuroendocrine metastatic castration-resistant prostate cancer.
The following article will focus on the market prospects and value of IGALMI for the treatment of agitation.
Financials
Before starting, let's review BioXcel's financials . The company generated revenue of $137,000 for Q3 2022 and incurred a net loss of $41.8M, with 40.8% attributed to SG&A expenses. As the company continues to promote IGALMI and progressing BXCL701 to phase 3, expenses may increase. As of January 30, 2023, BioXcel has a market cap of $867M, cash and cash equivalents of $232M, and long-term debt of $91M. The estimated cash runway is 1.5 years, meaning the company may need to increase debt or issue new shares for additional funds beyond that period. However, BioXcel may have access to more funds through its $260M long-term financing agreement reached in April 2022, subject to certain conditions.
IGALMI - Unfavorable Real-World Prospects
History of dexmedetomidine - intravenous to sublingual
Dexmedetomidine is an alpha-2 adrenergic agonist medication that is used to induce sedation and alleviate anxiety in various medical and surgical settings, such as emergency departments, operating rooms and intensive care units (ICUs). It works by activating alpha-2 receptors in the brain, which leads to a reduction in the levels of neurotransmitters such as norepinephrine and dopamine, resulting in sedation, reduced anxiety, and a decrease in the need for other sedative and analgesic drugs.
Dexmedetomidine is usually delivered intravenously. It is primarily used for short-term sedation of critically ill patients in the ICU setting. Dexmedetomidine has been studied for many conditions, including sedation for mechanical ventilation, sedation for procedures in critically ill patients, and as an adjunctive treatment for pain and anxiety associated with withdrawal from opioids and alcohol.
Although requiring intensive monitoring, it is generally considered safe and well-tolerated, with the most common side effects being low blood pressure, slow heart rate (bradycardia), and dry mouth.
In impressive fashion, BioXcel managed to get their sublingual formulation of dexmedetomidine to market after just a few years of development - from IND acceptance in late 2018 to FDA-approval April 5, 2022.
Current treatments for acute agitation in schizophrenia/bipolar disorders
Managing acute agitation in schizophrenia/bipolar patients can be a difficult task. Various techniques and medications are currently in use to address this symptom, including:
- De-escalation techniques (such as calming environment, distraction)
- Antipsychotic medications (such as haloperidol, lorazepam)
- Benzodiazepines (such as lorazepam, diazepam)
- Atypical antipsychotics (such as olanzapine, risperidone)
- Ketamine
- Electroconvulsive therapy (ECT)
- Physical restraints
As you can see, the market for the treatment of acute agitation is saturated and includes many drugs that have been in use for many years, work very well, and are, generally, safe to administer. These are major barriers for IGALMI.
The unpredictable market for drugs in a healthcare setting
According to IGALMI's label:
IGALMI should be administered under the supervision of a healthcare provider. A healthcare provider should monitor vital signs and alertness after IGALMI administration to prevent falls and syncope.
For now, IGALMI will only be administered in a healthcare setting. It is unlikely to bring in a consistent and predictable revenue compared to outpatient drugs. IGALMI does not offer any unique benefits over existing drugs for agitation and faces tough competition from long-established, effective treatments. The sublingual delivery method may also pose a challenge, as administering any medication to an acutely agitated patient is already difficult. Administering a sublingual drug requires cooperation from the patient, which may not be possible in real-world situations, as seen in IGALMI's clinical trial data.
IGALMI's unique safety concerns
IGALMI is distinct from other drugs in that it can cause orthostatic hypotension and bradycardia (dose dependent) in a considerable number of patients. 16-18% of patients receiving IGALMI experienced orthostatic hypotension two hours after administration. This can lead to adverse events like falls. In clinical settings with close monitoring, this may not be a concern, but in real-world settings with staffing shortages and limited resources, it can pose a significant risk. Profound bradycardia (less than 50 beats per minute) was observed in 6-7% of patients receiving IGALMI. This can cause adverse events like fainting. Healthcare providers may hesitate to use the drug without a heart monitor, which requires specific placement within healthcare institutions, limiting its potential use in behavioral units.
Trial design was irrelevant for real-world scenarios
The efficacy data of IGALMI is unlikely to be applicable in real-world settings, such as emergency departments, due to the way the trial was conducted. Participants in the trial met the criteria for mild-to-moderate agitation but were calm enough to provide informed consent, place the film under their own tongues, and were, mostly, treated in controlled clinical research units. As a result, clinicians are unlikely to use IGALMI ahead of the other available anti-agitation options. In fact, popular clinical resource UpToDate states that there is insufficient evidence and clinical experience to support its use.
Management hopes to broaden indication for IGALMI
BioXcel aims to expand the use of IGALMI for agitation in Alzheimer's patients and in non-emergency settings, such as homes and nursing homes . However, this may prove challenging due to the limited studies on IGALMI in patients over 65 years old and the lack of resources in nursing homes to safely monitor patients during and after administration. IGALMI is also associated with orthostatic hypotension and bradycardia, which are not safe to experiment with outside of a hospital setting, and older patients are more prone to experiencing drug-related adverse events.
Conclusion
In conclusion, despite the initial success of BioXcel's sublingual formulation of dexmedetomidine (IGALMI) in a clinical setting, the real-world prospects for this drug appear to be unfavorable. The market for the treatment of acute agitation in schizophrenia/bipolar patients is already saturated with effective, established drugs and practices, and IGALMI offers no significant benefits over these options. Additionally, the sublingual administration of IGALMI can be a challenge in an agitated patient, and the drug's potential side effects, such as orthostatic hypotension and bradycardia, pose significant risks. Furthermore, the efficacy data from clinical trials is unlikely to generalize to a real-world setting and is not recommended by current UpToDate guidelines.
I would not attribute any value to IGALMI. This is in contrast to the current market, which values BioXcel at nearly $1 billion. While the company has prospects beyond IGALMI that may prove fruitful, it appears shares of BioXcel are overvalued on account of IGALMI likely being a dud.
For further details see:
BioXcel Therapeutics: IGALMI Is Likely A Dud In The Real-World