After dropping to its lowest valuation at the end of September, the BioWorld Neurological Diseases index, a price-weighted index of public biopharmaceutical companies that are focused on developing therapies to treat neurological diseases, got on a roll and climbed 22% during the next two months. However, a surprising trial failure reported by Sage Therapeutics Inc. last week served to eat into those index gains.  

At the end of November, the index was tracking up almost 7% for the month, well ahead of the general markets, with the Nasdaq Composite index and the Dow Jones Industrial average returning 4.5% and 3.7%, respectively in the same period. (See BioWorld Neurological Diseases index.) 

Value plummets 

Sage Therapeutics Inc. saw its share value (NASDAQ:SAGE) plummet 58.3% last week, shaving $90.31 off its final closing November price. The catalyst was its phase III Mountain study of SAGE-217 on depressive symptoms in adults with major depressive disorder (MDD), that failed to hit the primary endpoint despite some encouraging top-line data from the trial.

The outcome took analysts by surprise, among them Yatin Suneja, of Guggenheim Securities, who, however, did have some encouraging words and suggested, among other things, “that SAGE-217 may still gain approval based on 3 ongoing trials in MDD (can still be amended if needed to increase probability of success), which if successful could support filing. We remain Buy but lower our PT to $110 (from $200).” 

As a result of Sage’s slide, the BioWorld Neurological Diseases index dropped to close Dec. 9, down 12.5%. 

Progress in Alzheimer’s disease 

Certainly, it was a busy start to December in the CNS diseases world with the focus squarely on the Clinical Trials on Alzheimer’s Disease (CTAD) meeting, where index member Biogen Inc. followed up on its October announcement that it would file for FDA approval of beta-amyloid-targeting aducanumab despite terminating studies on the compound earlier this year.

The reversal, the company said, was based on new analysis of a larger dataset showing that aducanumab reduced clinical decline in patients with early Alzheimer's disease as measured by the prespecified primary and secondary endpoints. The phase III study called Emerge met its primary endpoint of reducing clinical decline at the high dose, once patient follow-ups were counted, and in the late-stage experiment known as Engage, encouraging results turned up in a subset of high-dose patients as well. The added findings didn't come to hand until after the futility analysis by the monitoring committee, which in March advised that both experiments be discontinued since neither was likely to meet its primary endpoint.

Analysts appeared to be less impressed than scientific experts on the Biogen’s additional outcome data presented at the CTAD meeting. Shares of Biogen (NASDAQ:BIIB) closed Monday up 27% since the end of September, reflecting investor interest in the potential of aducanumab despite the misgivings of the Street. 

On a tear 

Continuing to drive the index into positive territory is New York-based Axsome Therapeutics Inc., whose shares (NASDAQ:AXSM) have been on a meteoric rise this year, up almost 1,300% year-to-date, a performance that will likely take a leading position in BioWorld’s “Darlings of Wall Street” feature, that will be published in early January. Favorable phase II data with its N-methyl-D-aspartate receptor antagonist, AXS-05, in major depressive disorder patients in the U.S. helped drive the company’s share valuation earlier this year.

Recently, the company reported that AXS-12 (reboxetine) met the prespecified primary endpoint and significantly reduced the number of cataplexy attacks as compared to placebo in patients with narcolepsy in the CONCERT phase II trial. It also significantly reduced excessive daytime sleepiness, and improved cognitive function, sleep quality and sleep-related symptoms. The company’s shares jumped 63% in November. 

New York-based Ovid Therapeutics Inc.’s shares (NASDAQ:OVID) were also on a tear in November, closing the month up 84%. Investors seem to be impressed with the potential of its product pipeline, with multiple clinical trial data readouts expected in 2020, “including top-line results from our pivotal phase III NEPTUNE trial in Angelman syndrome,” noted Jeremy Levin, chairman and CEO, in the third-quarter financial results 

Patient enrollment in the study, which will include approximately 60 pediatric patients ages 4 to 12 years, has started and will evaluate OV-101 (gaboxadol), a delta-selective GABAA receptor agonist, in Angelman syndrome, a rare genetic disorder that is characterized by a variety of signs and symptoms, including delayed development, intellectual disability, severe speech impairment, problems with movement and balance, seizures, sleep disorders and anxiety. The company anticipates top-line data from the trial to be available in mid-2020. 

Cannabinoid therapies 

Despite taking a tumble in September, shares of Devon, Pa.-based Zynerba Pharmaceuticals Inc. (NASDAQ:ZYNE) are trading up 113% year-to-date.

The company is a developer of pharmaceutically produced transdermal cannabinoid (CBD) therapies to treat rare and near-rare neuropsychiatric disorders. Its Believe 1 phase II trial assessed the safety and efficacy of lead candidate Zygel, a CBD gel in developmental for epileptic encephalopathies in children and adolescents. Top-line data from the trial that enrolled 48 patients between the ages of 3 and 16 (mean=10.5; median=10), showed patients achieved 44% to 58% monthly median reductions in seizures compared to baseline from month two to month six of treatment.  

The company said it intends meet with the FDA to discuss a regulatory pathway forward for Zygel in developmental and epileptic encephalopathies in the first half of 2020.  

The company also reported in its third-quarter financial results that enrollment is progressing in the CONNECT-FX pivotal trial evaluating the efficacy and safety of Zygel in treating common behavioral symptoms of fragile X syndrome in 3- through 17-year-old patients and that pivotal data will be available by the middle of next year.  

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