With a new year just around the corner, Pharmaxis is well-funded after closing the September quarter with 23 million cash and in October receiving its 2019 R&D tax incentive of $6.2 million.
In addition, Pharmaxis anticipates receipt of a US$10 million milestone payment for Bronchitol® from its US licensee Chiesi in Q3 of 2020 subject to FDA approval mid-year.
“Disappointed” with BI decision
Although disappointed with a decision by Boehringer Ingelheim (BI) not to progress studies of the AOC3 inhibitor acquired from Pharmaxis in 2015 for treatment of NASH, the company is looking forward to further developing its strategy in 2020.
Pharmaxis CEO Gary Phillips said, “We are obviously disappointed by BI’s decision not to progress the compound acquired from Pharmaxis in NASH. This was unexpected.
“We understand the significant hurdles to overcome in the early stages of drug development and that is why the company has pursued a strategy of generating multiple research pipeline opportunities underpinned by our cash position and a partnering strategy which offlays development risk where appropriate.”
The reason provided by BI for the discontinuation after a successful phase 2a study that met its safety and efficacy endpoints was the potential for drug interactions in NASH patients.
Further studies continue
A second study of the drug in diabetic retinopathy with associated milestone payments will continue with future development to be decided by BI following completion of the current phase 2a study due to report 2H 2020.
Boehringer Ingelheim’s decision has no impact on short term cash as the next milestone payment for NASH was not scheduled until the commencement of a phase 3 study in several years’ time.
Drug development pipeline
The company’s drug development pipeline includes two drug projects that can be brought to valuation points with the current cash position:
- Partnering of best in class anti fibrotic LOXL2 inhibitor program
- The company is engaged in discussions with potential partners and those discussions will continue into next year. A variety of deal structures are being considered including global pharma and regional pharma deals, all of which fund the future LOXL2 inhibitor development program.
- Commencement of clinical proof of concept studies in myelofibrosis
- The company’s systemic pan-LOX inhibitor program has recently cleared 3-month tox studies and is anticipated to successfully conclude the final stage of a phase 1 study in healthy volunteers in Q1 2020. PXS will shortly seek approval from the FDA on orphan status for the treatment of the bone marrow cancer myelofibrosis and seek feedback via the IND process on progressing to phase 2 trials in this disease where there is a high level of unmet need and an existing market value in excess of US$1 billion per annum.
LOX inhibitor program
The company also has a topical pan-LOX inhibitor program that has potential in scar revision.
This program is completing late-stage pre-clinical testing and is anticipated to enter a phase 1 clinical trial in healthy volunteers in 2020.
Phillips added, “The topical LOX inhibitor has significant market potential in both post-surgical and cosmetic indications.
“The company will carefully consider the optimal development plan based on the financial resources required and the level of interest from pharma companies with an interest in dermatology.”