The next wave of drug discovery is being enabled by artificial intelligence (AI). This fact has not been lost on investors, who are keeping a close watch on emerging biopharma companies that are using AI and machine learning to enable the discovery of next-generation medicines. As the year closes out, the BioWorld Artificial Intelligence price-weighted index, which includes biopharmaceutical companies, medical devices and health care services companies that are utilizing AI, has increased 22% in value. (See BioWorld Artificial index 2019, below.) 

Contributing to the jump is New Haven, Conn.-based Bioxcel Therapeutics Inc., which is among a group of biopharmaceutical companies in the index that are utilizing artificial intelligence approaches to identify and advance the discovery and development of new medicines. This week, the company reported the start of its SERENITY (Sub-Lingual DExmedetomidine in Agitation Associated With SchizophRENIa and Bipolar Disorder STudY) program, that includes two phase III studies of BXCL-501 for the acute treatment of agitation in patients with schizophrenia and bipolar disorder. 

SERENITY I will enroll patients with agitation associated with schizophrenia, with each arm receiving either BXCL-501 at 120 mcg, 180 mcg or placebo. SERENITY II will evaluate patients with agitation associated with bipolar disorder, also with each of three arms receiving either BXCL-501 at 120 mcg, 180 mcg or placebo. The primary endpoint is the reduction of acute agitation measured by the Positive and Negative Syndrome Scale, examining the excited component change from baseline compared to placebo. The adaptive trials will involve up to 750 patients 18 to 75 years of age, and top-line data are expected in mid-2020. The company’s share price (NASDAQ:BTAI) has risen almost 66% in December, and 167% for the year. 

The shares of New York-based Progenics Pharmaceuticals Inc. (NASDAQ:PGNX) have also jumped 21%. It is focused on developing targeted oncology medicines and artificial intelligence and has just reported positive top-line results from the phase III CONDOR trial evaluating the diagnostic performance and clinical impact of PyL (18F-DCFPyL) in men with biochemical recurrence of prostate cancer. PyL is a PSMA-targeted small-molecule positron emission tomography (PET) imaging agent designed to visualize prostate cancer. The study achieved its primary endpoint, with a correct localization rate (CLR) of 84.8% to 87% among the three blinded independent readers (the lower bound of the 95% confidence intervals ranging from 77.8% to 80.4%).  

Based on the study results, the company said it plans to submit a new drug application to the FDA for PyL in the second half of 2020. 

M&As 

In October, Lantheus Holdings, of North Billerica, Mass., said it planned to acquire Progenics, with the deal expected to close in the first quarter of 2020. 

In the same month, the index also “lost” Medidata Solutions Inc., of New York, a specialist in software and services for the management and data analysis of clinical trials, when it was acquired by French software company Dassault Systèmes for $5.8 billion in cash. The deal enables Dassault to offer needed end-to-end support to pharma and diagnostics companies, from initial research to clinical development, manufacturing and commercialization, the company said. 

Medidata's software is used by 1,300 customers in the clinical development and commercialization of drugs, including 18 of the top 25 pharma companies and nine of the top 10 contract research organizations. 

Trial progress 

Gritstone Oncology Inc. presented preliminary phase I GRANITE immunogenicity data at the European Society for Medical Oncology (ESMO) Immuno-Oncology Congress in Geneva that demonstrated robust and consistent induction of large numbers of CD8+ T cells against multiple neoantigens in four solid tumor patients with available IFN-g ELISpot data within the first two dosing cohorts. In addition, those T cells were also able to produce IL-2 and Granzyme B, demonstrating that they have cytotoxic potential.  

In a research note, Wainwright analyst Swayampakula Ramakanth said, “We are encouraged by these immunogenicity data and believe higher doses of samRNA and the addition of anti-CTLA-4 antibody could further boost the number of induced CD8 T cells, which is evidenced in preclinical studies.”  

The company’s GRANITE personalized immunotherapy delivers a cassette of 20 TSNA identified by its EDGE artificial intelligence platform and tumor HLA peptide sequencing, representing tumor-specific neoantigens that are derived from the patient’s own tumor. GRANITE is being evaluated in combination with immune checkpoint blockade in a phase I/II study for the treatment of patients with advanced solid tumors. 

Gritstone’s shares (NASDAQ:GRTS) are trading down 45% this year. 

Venture capital flows 

Venture capital firms and health care companies are also recognizing the importance of this emerging area, and over the past two years global companies in this space have attracted well in excess of $1 billion in investment funds. Among them is Standigm Inc., an artificial intelligence-powered biotech company based in Seoul, Korea, that received ₩10 billion (US$8.6 million) from SK Holdings Co. Ltd. 

The company develops its own AI systems designed to quickly examine biomedical databases, generate drug candidates and filter final compounds in a virtual environment. 

Editor’s note: The BioWorld Financings 2019 Review, that will be published next week, will examine the sectors, including AI, that are attracting venture capital as well as break down the total amount of public and private funding attracted during the year.

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