Axonyx Inc. reported disappointing, though not unexpected, results from its final two Phase III trials of Phenserine in mild to moderate Alzheimer's disease patients.

The New York-based company said top-line data failed to show statistical significance over placebo, as measured by standard cognition scales. Those results confirmed findings reported in February from the first Phase III study of Phenserine, a selective acetylcholinesterase inhibitor, in which the drug failed to meet its cognition endpoint of improved memory in 375 patients. (See BioWorld Today, March 15, 2005.)

"We kind of knew we would probably not achieve statistical significance" in the two additional Phase III trials, said Colin Neill, chief financial officer of Axonyx, since those trials involved "the same immediate-release formulation" at the same 10 mg and 15 mg dosage levels.

Shares of Axonyx (NASDAQ:AXYX) lost 15 cents Tuesday to close at $1.09 (or 12.1%).

The studies initially were designed to enroll 450 patients each, with a 26-week treatment period. But, after the first Phase III miss, the company halted recruitment and cut the treatment period by more than half. The combined studies evaluated a total of 255 patients and cut the treatment period to 12 weeks.

Patients were assessed throughout the trial period using the Alzheimer's Disease Assessment Scale (cognitive subscale) and Clinical Interview-Based Impression of Change with caregiver input. Since neither dose of Phenserine met the primary endpoint, no secondary outcomes were analyzed.

Results "were very much as we expected," Neill told BioWorld Today. But the company still is hoping for some positive news from a Phase IIb study of Phenserine, which will measure the reductions in beta amyloid levels in the patients' brains, as well as evaluate standard cognition.

Phenserine, licensed from the National Institutes of Health in Bethesda, Md., is designed with a dual mechanism of action, focusing both on improving cognition and reducing the levels of beta amyloid in the brain, which is believed to be a cause of Alzheimer's. However, the Phase III studies did not look at changes in beta amyloid levels. The Phase IIb study will measure the level of beta amyloid in patients' cerebral spinal fluid at baseline and six months.

That trial is almost fully enrolled, and data are anticipated around the end of the first quarter of 2006.

In the meantime, efforts have been ongoing to reformulate Phenserine as an extended-release drug.

The immediate-release formulation "powers into the brain and dissipates," he said. The aim of reformulating Phenserine is to "get more of the drug into the brain."

Axonyx hopes to complete the reformulation in the early part of 2006, though it plans to seek partners to co-develop the product, Neill said.

The company now is focusing on two other products in its pipeline, both for treating Alzheimer's Disease. Posiphen, a disease-modifying drug aimed at disease progression, recently began a Phase I trial in healthy volunteers. Posiphen is a positive isomer of Phenserine and targets only the reduction of beta amyloid. Preclinical studies showed a lack of toxicity, which might allow the drug to be administered at higher doses than Phenserine. Posiphen is for mild to moderate Alzheimer's patients.

A third drug, BisNorCymcerine, is in late preclinical studies as a potentially symptomatic treatment of moderate to severe Alzheimer's disease.

Axonyx reported a net loss of $8.2 million for the second quarter of 2005. Its research and development costs for the quarter totaled about $7.4 million. As of June 30, the company had cash and cash equivalents of $70.3 million.

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