Update Compendium 2024

Bottom-line Up Front (BLUF): On 23 Dec 2024, Anavex Life Sciences announced the acceptance of their centralized MAA by European health regulators. This critical milestone begins a 210 day evaluation period (with two stops) which should result in a regulatory decision in 3rd/4th quarter 2025. With this milestone came significant market excitement, with Anavex's (AVXL) share price extending 30% gains on the day. This excitement is well-warranted considering the undervaluation of the company and it's impending attendance & presentation at JPM Healthcare Conference 2025 (JPM25). At JPM25, Anavex is expected to reveal more complete details of their Alzheimer's phase 2b/3 open label extension data (OLE). Available abstracts indicate that the OLE was well-tolerated from a safety standpoint and resulted in statistically significant cognitive & functional improvement between longer-dosed patients and shorter-dosed patients. ADAS-COG showed a -3.83 point difference [negative scores are good] and ADCS-ADL showed a +4.30 point difference [positive scores are good] between these cohorts at 192 weeks (+3.5 years). These improvements are clinically meaningful to the patient and demonstrate the need for patients to begin therapeutic intervention with Blarcamesine as expeditiously as possible (whether as a monotherapy or adjunctive). Blarcamesine has shown to significantly reduce whole brain atrophy (37.6%), gray matter atrophy (63.5%) and lateral ventricle atrophy (25.1%); and its mechanism of action addresses extremely early physiological autophagy dysfunction (observed 10-20 years before toxic amyloid/tau build-up). Considering gray matter's highly accurate prediction value in determining whether an MCI patient will progress to mild Alzheimer's or revert back to normal cognition, it is unsurprising that a drug addressing both atrophy and upstream autophagic dysfunction renders scientifically ground-breaking cognitive benefit to Alzheimer's patients (which likely extends cross CNS to other disorders). Spirit of the Coast Analytics assesses Anavex's presence at JPM25 this year will be met with enthusiasm by prospective big pharma bidders. We believe it is highly likely that suitors will be presented curated investment dossiers to entice a partnership or buyout. Our confidence in this assessment is bolstered by minimal dilution and cash reserve lowering revealed in Anavex's 10K - potentially indicating the company's confidence in no longer needing their own cash reserve. Combined with Anavex's very early announcement of attendance, OLE presentation, and MAA acceptance, JPM25 is likely going to be a near-term pivotal moment for the company. 

We have spent tens of hours over the last week listening to third party commentary on JPM25. By far the most useful time was spent listening to Genchrome Ltd's synopsis published on 13 Dec 2024. In this hour long segment three industry leaders discussed JPM25 and effective pharma pitches. These leaders consisted of:

• Philippe Lopes-Fernandes, Executive Vice President, Chief Business Officer, and Member of the Executive Committee at Ipsen. 

• Roel Bulthuis, Managing Partner at Syncona Limited 

• Caroline Boulliat, CEO of Genchrome and former pharma executive at Amgen, Pfizer, MSD, & GSK 

Below you will find our notes on the video as we found them helpful when contextualizing Anavex's attendance at JPM25. All notes are paraphrased and not direct quotes. We have bolded the most key items pertaining to Anavex but recommend reading the notes in entirety for best context.

• “No longer enough to simply get a drug approved. The package needs to be robust enough that price experts and systems can be engaged globally - which is a complex problem”

• “BP is definitely still looking for multi-billion revenue drugs. One billion is no longer enough. That’s why obesity market is doing so well because it’s an +80B market”

• “Mid sized players are now taking up the mantle to conduct M&A with drugs worth $500M - 1B”

• “Currently in one of the longest sustained bear markets for biotech”

• “Cost of capital to fuel operations is very high right now - thus less capital being invested into the bio sector at large”

  • • Comment: BP must be selective.

• “We are currently emerging from that bear market but there are uncertainties with rate cuts and political considerations”

• “A lot of patent expirees coming - need to plug those gaps”

• “BP mostly looking for late stage drugs to add to their pipelines”

• “Big shareholders in BP increasingly complain about early stage M&A because this does not always materialize [failure]”

• “It’s easier to do licensing for earlier stage drugs and easier to do straight up M&A for late stage drugs”

• “Of course, which route we choose really comes down to what our endgame is and what WE are looking to achieve. For many the goal is to BUILD a company. But there is a calculus where maybe our drug IS better with BP. Sometimes this is driven by global need, our ability to market, and obviously how lucrative it is to us”

• “Being financed to go alone makes this decision easier”

  • • Comment: Dr. Missling has kept a cash reserve of ~$150M for years but has let that slip recently as indicated by 10K filings.

• “We had an example where our primary compound in our primary indication had extremely strong data and we had the ability to go alone... BUT we found that the drug had a lot of application in a ton of other indications and so at that point it became more beneficial to make a licensing deal with BP so that we could explore the other indications”

• “Going back to BP vs mid-size Pharma in deal-making… BP is addressing indications that we (small biotech) cannot address… like Alzheimer’s”

• “Mid sized pharma does engage in large indications - but usually drugs that address subpopulations OF that large indication “

• “What is mid sized pharma today MAY be BP tomorrow”

• “10-12 years from discovery to launch and a lot can happen in between that”

• “Want to find a BP that has the COMMITMENT to your asset and PRIORITIZE its development. Sometimes pharma changes strategy over time and don’t continue developing your deal, and you stagnate”

• “Sometimes it’s BP that you can trust to do this. But sometimes, it’s mid-sized”

• “Usually drugs worth over $800M WILL be prioritized by BP”

• “A deal can be very fast, sometimes a few weeks”

• “Sometimes it takes longer because you need to get the acquirer comfortable with your science/MOA”

• “There are about 1,000 targets every year”

• “Usually it’s easy to filter out targets that are NOT right for us, the rest takes more time”

• “Biotech needs to give BP adequate time to investigate. Not ‘oh we need a deal next month’”

• “Maximize the QUALITY of interactions between perspective partners. Not about quantity”

  • • Comment: We have high confidence Anavex began approaching at least 3 big/medium pharma starting in Q1 2023 - one of which was Sanofi headquartered in France.

• “Generally it’s a waste of time to approach mid-size for Alzheimer’s because it’s just not feasible to partner there”

• “We want to display a drug/target that is shiny. Something BP wants but can’t have. This is where the $$$ comes in”

  • • Comment: It’s about the long game. Dr. Missling has likely been enticing BP the entire way to approval and not giving in to low ball offers.  As things continue progressing and looking attractive he has likely continued engaging the same BP in order to incite an 'itch'.

• “Being in a position to continue as a stand alone company is the MOST advantageous place you can be in order to sell yourself to BP”

• “Your leadership and board MUST be strong. Need important players. The network is very important”

  • • Comment: Anavex considerably strengthened their leadership team in 2024.

• “Need JOINT belief that a deal can be done. A confidence in each other”

• “Need a partner that can maximize, accelerate, and globalize”

• “BP does not expect small biotech to be able to have market access in EVERY region. It’s more complex than that. But BP DOES NEED more than regulatory approval. Need robust data in place to be able to discuss pricing and entry”

• “Again, BP does not expect biotech to have all the answers and be in the absolute best position. They need ‘enough’ to work together”

• “Biotech needs to have some level understanding of their commercialization positioning before coming to BP - including the challenges”

• “This entire thing needs to be an iterative process. Not ‘oh we met this goal, what’s next’"

• “You have a short window to really sell the product. Bring the product to life”

  • • Comment: Spirit of the Coast assesses this window for Anavex is NOW.

• “What is going to be the market and what is going to be the price of the drug are two must haves when approaching BP”

• “No one answer on how to decide the best time for a deal. Best time is probably when you are in a position to go alone because you have the most leverage”

• “It’s really about having forethought. DO NOT take this day by day. Be realistic if your investors can take you to market”

• “You need a window so you aren’t rushed into a bad deal. SOMETIMES it’s 2-3 years of finessing a BP”

  • • Comment: We go back to the comments above. We have evidence to support Anavex engaging with at least 3 big/medium pharma since at least 1Q 2023.

• “Do not underestimate the amount of time this could take”

• “Do not pass on the right collaboration out of stubbornness. If it’s right, go for it”

• “Sometimes the best timing for a deal is actually dictated by the overall market and overall BP interest at that time”

• “Too much detail at JPM or a like-conference is bad. I don’t have time. Give me the BLUF, give me the end game. 2ish slides”

• “We do NOT need the history lesson of your company. Give us the ‘movie’”

• “If we are interested in your ‘movie’ then we will continue digging after that.”

• “What we don’t like are companies that reach out to us and give us general angles on market penetration. Make it about the patient” 

• “Advisors facilitate dealmaking between biotech and BP by having ex-BP on the team and knowing what BP likes. Advisors focus on only a few small biotech to maximize engagement and knowledge of the compound/unmet need”

• “At the end of the day, we [BP] want to see conviction of the biotech. It’s not about how unique your MOA is, or whether you used AI to get to where you are. The bottom-line is, will your drug help patients. We are impressed with patient-centric biotech”

Conclusion: Taking in Anavex's milestone landscape (MAA acceptance, OLE readout and attendance at JPM25, paper publication by JPAD in Jan 2025) and considering the notes above, it is obvious that the company is in a key window of opportunity to advance BP partnership or buyout offers. We feel blessed to have come this far with Anavex and are excited to see what is in store for 1Q 2025. Merry Christmas from Spirit of the Coast, and have a happy New Year!

Bottom-line Up Front (BLUF): On 18 Dec 2024, Cognition Therapeutics released topline data for their six month placebo-controlled phase 2 DLB trial. Overall the trial was successful and met it's objectives with exciting findings bulleted below. More complete results are expected at the International Lewy Body Dementia Conference (ILBDC) in January 2025 and full topline presented today can be found here. 

• DLB is extremely heterogeneous with a wide-array of pathologies and symptoms. Because of this variance it is very difficult to address holistic patient need during clinical trial - resulting in high failure rate. The disease is aggressive resulting in rapid death (4 - 7 years after diagnosis).

  • • Cognition's results showed CT1812 had a sweeping therapeutic effect on global burden including: cognition, psychiatric, behavior, motor, and function indicating probable disease modification properties.

    • Separation in slopes between pooled dosed arms and placebo continued expanding over time in eight measures over six months - again indicating disease modification with beneficial change in disease course. 

• Caregiver burden (distress) as assessed by NPI did not decline over six months, and actually showed improvement over baseline (114% slowing over placebo) at the end of the trial.

• Drug was safe and mimicked outcomes from the SHINE Alzheimer's trial. Higher side effects in the higher dose (300mg) is not warranted as the 100mg group performed similarly from an efficacy standpoint. Going forward, a target dose under 300mg (i.e. 200mg) is more likely the best 'bang for your buck' as far as an efficacy/safety axis is concerned. 

• Cognitive assays (MOCA, CDR - Episodic Memory, CAF) improve confidence of memory preservation as seen in the SHINE Alzheimer's trial (39% slowing in ITT and 95% slowing in low p-tau217 sub-population representing approximately 45% of the patient population).

  • • MOCA (broad cognitive treatment effect): 60% slowing in decline compared to placebo 

    • CDR - Episodic Memory (ability to learn and recall after time goes by): 85% slowing in decline compared to placebo

    • CAF (fluctuations in memory): 91% slowing in decline compared to placebo

• DLB represents a very large unmet need with no approved therapies. The vast majority of DLB trials fail to show signal in phase 2 and don't move on to phase 3. Cognition Therapeutics has the opportunity to continue with this data towards a phase 3 trial which may result in their drug being the first approved for holistic DLB treatment. The DLB market is around $5-6B currently and is expected to grow to about $10B in 2032.

Clinical effects of Lewy body pathology in cognitively impaired individuals

In 2023 a paper was published in Nature Medicine that showcased clinical manifestations of Lewy Body pathology. It revealed the intensive heterogeneity of the disease, the symptoms, and severity of symptoms a patient could experience dependent on their amyloid positivity, tau positivity, and a-synuclein positivity. 

Abstract: "There is poor knowledge about the clinical effects of Lewy body (LB) pathology in patients with cognitive impairment, especially when coexisting with Alzheimer’s disease (AD) pathology (amyloid-β and tau). Using a seed amplification assay, we analyzed cerebrospinal fluid for misfolded LB-associated α-synuclein in 883 memory clinic patients with mild cognitive impairment or dementia from the BioFINDER study. Twenty-three percent had LB pathology, of which only 21% fulfilled clinical criteria of Parkinson’s disease or dementia with Lewy bodies at baseline. Among these LB-positive patients, 48% had AD pathology. Fifty-four percent had AD pathology in the whole sample (17% of mild cognitive impairment and 24% of patients with dementia were also LB-positive). When examining independent cross-sectional effects, LB pathology but not amyloid-β or tau, was associated with hallucinations and worse attention/executive, visuospatial and motor function. LB pathology was also associated with faster longitudinal decline in all examined cognitive functions, independent of amyloid-β, tau, cognitive stage and a baseline diagnosis of dementia with Lewy bodies/Parkinson’s disease. LB status provides a better precision-medicine approach to predict clinical trajectories independent of AD biomarkers and a clinical diagnosis, which could have implications for the clinical management of cognitive impairment and the design of AD and LB drug trials."

Key outcomes of this study demonstrated that patients with only Lewy Body pathology or patients with Alzheimer's + Lewy Body pathology universally performed worse than patients with only Alzheimer's pathology or dementia without any of these pathologies. This result underscores the aggressive nature of DLB. Below in Figure 1 you can visualize these findings.

Cross referencing Figure 1 to Cognition Therapeutic's presentation today, we can draw parallels between trial design and meaning behind results. For example in Figure 1, Section C/F, Section G/J, Section H/K, and Section I/L we see that patients with Lewy Body pathology perform significantly worse than dementia patients with amyloid/tau for attention & executive function, visuospatial function, hallucinations, and motor function. 

• Section C/F, Attention & Executive Function:  Addressed primarily with MOCA and tertiarily CAF, which saw 60% and 91% slowing respectively

• Section G/J, Visuospatial Function: Addressed primarily with MOCA and tertiarily CAF, which saw 60% and 91% slowing respectively

• Section H/K, Hallucinations: Addressed with 82% slowing on NPI assessment; high efficacy noted against anxiety, delusions, and hallucinations

• Section I/L, Motor Functions: Addressed primarily with 62% slowing on MDS-UPDRS

With the results presented by Cognition Therapeutics today, Spirit of the Coast Analytics postulates that the drug likely alters disease course, which would possibly meaningfully extend a patient in earlier disease stages and potentially extend longevity in this fragile patients. To expand upon the cross referencing of Figure 1, we present Figure 2 to showcase longitudinal worsening of these symptoms. Pay special attention to the pink and orange curves in Sections A/B/C/D. 

Using Figure 2 we can see that patients with negative Alzheimer's pathology but with Lewy Body pathology (orange) and dual positive Alzheimer's and Lewy Body pathologies (pink) decline rapidly on visuospatial function especially, and dual pathology patients (pink) also have more severe decline in global cognition, attention & executive function, and longitudinal memory. The latter three measures were particularly influenced by tau and Lewy Body pathology rather than amyloid. 

Figure 2 emphasizes the impact that slowed disease progression can have on an aggressive disease like DLB. Global improvements against the full spectrum of the disorder as well as increasingly separating slopes indicate disease modification; though it will take a larger (and likely longer) study to determine the exact kind of time-savings this therapy could potentially provide a patient longitudinally. 

Conclusion: Fueled by a $30M NIH grant, SHIMMER produced robust efficacy across all core DLB deficiencies. Results shown in Figure 3 reveal probable disease modification. Moving forward, Cognition plans to conduct meetings with key opinion leaders and advisory teams before having their end of phase 2 meeting with the FDA. Moving into a phase 3 later, the company plans to use intelligence garnered from SHINE and SHIMMER to design better study protocol in coordination with regulators. Some facets of this protocol will be reduction of max dose (less than 300mg) in order to improve the efficacy/safety axis, identify primary/co-primary endpoints, improve population size, and likely narrow down disease severity. SHIMMER featured mild and moderate stage DLB patients and an analysis of efficacy between earlier and later stage patients has not yet been provided. Statistical values have also not been provided, though it was indicated in the 18 Dec 2024 webcast that NPI probably met statistical significance. We look forward to seeing biomarker data when it is ready (which may lead to an accelerated pathway), and more analysis from SHIMMER in January 2025. To finish, CT1812 has now demonstrated cross-CNS efficacy in two major indications (Alzheimer's and DLB). We feel these results warrant continued interest in the company, especially as DLB needs remain particularly unmet. A larger trial with optimized dose and potentially optimized severity would likely lead to a successful phase 3 trial and possibly the first drug approved for this aggressive disease. Time saved for patients would be invaluable to clinicians, caregivers, and patients. 

Bottom-line Up Front (BLUF): On 26 Nov 2024, Martin Shkreli gave an initial analysis on Anavex Life Science Corporation. His feedback could be categorized as mostly neutral with light negative connotations. Overall, I think he is positioning himself discreetly in the background and didn’t want to influence price (YET). He concludes the video stating that there are signals of efficacy but “so much missing data”.

Fair points: Starting with points that are fair, accurate, or within reason.

• Paraphrase: “Company PRs are trash”. This is a fair statement; the company has never been exceptional at communications. Hopefully this can turn around at some point.

• Paraphrase: “Data readout, paper, and filing took way too long”. This is probably true - at least it would be for BP.

• “Data is inconsistent”. This is a true statement. Particularly from CTAD22, the 14 Sept 2023 PR, and the CTAD24 data points. What HAS been consistent are clinically meaningful cognitive scores, improvements to CDR-SB on par or better than approved therapies, good safety, oral availability, and significant biomarker improvements including amyloid and brain atrophy. In concert, these facets make Anavex’s Blarcamesine totally unique from monoclonal antibodies. This blends into the next bullet point.

• "A publication would make it a lot better" .... "I'd really like to see the paper on the phase 3". I agree. I think investors have written off the paper as a price mover, but I think it's more important than almost anything else. It will cement the data as record. According to information I have gathered, the paper is likely to be irrefutable due to the reputation and breadth of its authors – not to mention the reputation of the paper itself. The values provided in the paper will be the data going forward to the EMA, the FDA, and the TGA (later).

Entertaining statements: I have no ill-will towards Martin Shkreli, but these comments were entertaining.

• Paraphrase: "I know what I'm doing, I have done this a hundred times, I know how to evaluate a company". Proceeds to be confused for over an hour.

• "I know a lot about the FDA and approval, they've never changed anything for approval". This is categorically false as the FDA sent out a draft reform for early Alzheimer's trials earlier this year (to which my public opinion was quoted by RAPS here). 

• "Why wouldn't they file with the FDA”. As mentioned in previous reports, the ADCS-ADL miss made approval with the FDA uncertain, even with the built in ADAS-COG/CDR-SB combination allowed in the SAP. The draft FDA guidance once approved would likely improve odds with the FDA considerably and I expect the company will file in the Unites States shortly after that guidance is published. 

• States: "-2 points on ADAS-COG isn’t very much"... later..."Ordinarily this would be VERY good data, but there's just something missing, just very bizarre".

General comments:

• Paraphrase: "Combining (pooling) the cohorts is so bad, not normal". This isn’t true, its standard practice, and it was predefined primary analysis according to Dr. Missling (granted I don't think Dr. Macfarlane answered this well at CTAD22, which was partially referenced).

• Paraphrase: "The CTAD 2022 data is so weird... but it’s not just something you get wrong...something this important" (unfortunately this is probably the best fuel mentioned IMO as the CTAD release was rushed, didn’t use MMRM, and a bit inconsistent).

• Matt Nachtrab (the millionaire SAVA pumper) was the one that uploaded the CTAD22 video for Anavex which I didn't know and found interesting.

Conclusion: During the video, Martin Shkreli presented himself as a newcomer to Anavex – though I highly doubt this to be true – going as far as to put on a bit of a show for the viewer. He finishes the segment by leaving 'investment merit' in the company open-ended/non-definitive. I thoroughly doubt that he hasn’t decided on Anavex (this may be positive OR negative). Some of his finer critiques certainly do hold merit: communication from the company, the quality of press release over the years, data inconsistencies from publication-to-publication, and speed of operations. These are all facets that can be addressed or are inconsequential to the ultimate success of the company. It is our view that the most important catalyst for this company besides outright approval is publication of the 2b/3 Alzheimer’s paper (accepted by journal as announced on 25 Nov 2024). This paper will provide legitimacy to the company, its mechanism of action, and data – facets the company has been striving towards for nearly a decade. Despite its redeemable faults, Anavex does boast numerically superior cognitive data over any phase 2b/3 or 3 study. This cognitive data well exceeded the defined thresholds for ‘clinically meaningful' designation (between -1.5 and -2 points; or ~30% reduction according to ADDF’s Dr. Howard Fillit). CDR-SB global objectives were also met and are on-par with or exceed available monoclonal antibodies. Biomarker data including CSF amyloid 42/40 and brain atrophy significantly improved, indicating a disease modifying effect. This notion is backed up by lofty clinician positivity as indicated by the CGI-I endpoint. A 49.8% slowing in cognitive decline (expected in 70-85% of patients) is directly meaningful to a patient’s longevity, extension in earlier disease phases (less impactful disease stage), and the family/caregiver. Blarcamesine’s mechanism of action aids the majority of the Alzheimer’s population and addresses very early pathological dysfunction (impairment noted 1-2 decades before the onset of Amyloid burden). We assess approval chances in Europe to be high. This population desperately needs an efficacious Alzheimer's therapy that can be scalable through diverse local healthcare systems. A safe, inexpensive, easily transportable/storable, and clinically meaningful therapy that doesn't require MRI monitoring - a requirement that is a significant shortfall in many EU member states. We view the sudden approval of Leqembi as a positive with the bench for approval being set very low.

Bottom-line Up Front (BLUF): In this report we assessed European Union (EU) and U.S. Alzheimer's markets most addressable by Blarcamesine. Core outcomes of this analysis included Anavex market cap if able to meaningfully and independently pursue EU and U.S. early-stage patients, as well as market cap if partnered to a major pharmaceutical company - which is the more likely of the two scenarios. Figures seen in this analysis would be garnered after 3 - 5 years (peak sales).

Methods and Analysis:

• Using updated Alzheimer's Association statistics, we assessed raw market size and identified two broad disease-stage populations best addressed by the drug (MCI and mild/early Alzheimer's).

• Using large gene databases and data from the National Institute of Health, we then reduced ideal patient population further by refining the overall MCI + mild-AD group. This was done by identifying patients with SIGMAR1 WT (~84% in Europeans, N=20.3K / ~78% in Americans, N=13.6K), and patients with no APOE4 alleles (~74% in Europeans / ~77% in Americans). There are ~62% and ~60% odds or having met both of these criteria in Europe and the U.S. respectively. This group would constitute as the most desirable large subgroup, likely exceeding 49.8% slowing of cognitive loss.

• We then make a further subgroup of patients with SIGMAR1 WT, but with APOE4 alleles. Patients have ~22% and ~18% odds for this combination in the European Union and the U.S. respectively. This group is our second-most ideal patient population, which could expect to garner ~49.8% slowing of cognitive loss. 

• When combining our two most desirable MCI + early-stage Alzheimer's subgroups (higher end performers), we ended with ~10.9M and ~8.2M best treatable patients in the European Union and the U.S. respectively. It is likely patients outside of these top-tier subgroups would also be administered Blarcamesine but we omitted this from our analysis. 

• According to multiple analytic firms, a drug that addresses large, unmet fatal needs with oral administration, low costs, and low competition could expect to garner between 40% and 70% of a market share. We went with the lower end (40%) in both the European Union and the United States, though we expect European Union share to be higher than the U.S. due to staunch European demand for a disease modifying therapy with low-to-no restrictive storage requirements, ARIA monitoring, and cost-effective supply. Unlike the U.S. which has approved three disease-modifying therapies (debatably two, with marginal efficacy), the demand for a new disease modifying therapy in Europe is astronomical. 

• After market penetration we assessed annual drug cost, with our result relying heavily on an ICER report circa Aduhelm approval, as well as disapproval from EMA regulators over mAb pricing. With this in mind, we assess low conservative costs of the drug would be ~$8,500 and high conservative cost would be ~$15,000 in the United States. Due to pricing negotiations and bulk demand in Europe, drug prices are nearly always significantly discounted in Europe vs. U.S. markets. We assess a drug like Blarcamesine with few, if any biosimilars, would see a 30% cost reduction there ($5,950 - $10,500). We emphasize that these are conservative estimates at the very low end.

• Multiplying 40% of our best responders by these drug cost estimates rendered 10's of billions in revenue (if marketing independently). 

• To assess possible price to earnings we chose Pfizer and Johnson & Johnson as a case study, averaging their P/E over a three year timeframe. We felt that this adequately addressed our need for a big pharma P/E reference: ~19.6 - 26.6 P/E. 

• Continuing our trending of big pharma, we then wanted to assess what Anavex's potential P/E would look like in a low bio market and a high bio market. We were able to do this by choosing three low performing years and three high performing years as indicated by XBI year-over-year returns. Low years were 2016, 2018, and 2022. High years were 2013, 2014, and 2020. We then compiled the P/E for the top 10 biopharmaceutical companies of each of those years (indicated by market cap) and averaged the P/E for each year, omitting outliers (supplementary chart showing this data can be found in graphic 4 after our conclusion segment at the very end of the report). With this data, we assessed big pharma had ~18.35 P/E low-end, and ~23.45 P/E high-end, showcasing a weak (year: 2016) and strong (year: 2020) bio-sector respectively.

• After that we were easily able to calculate the potential earnings based on revenue and historical real-world big pharma data. We calculated this in four categories:

  • • Low bio market with low drug cost

    • Low bio market with high drug cost

    • High bio market with low drug cost

    • High bio market with high drug cost

• Finally, we assess Anavex Life Sciences almost certainly requires a big pharma partnership in order to execute these projections. While other options exist, we anticipate an upfront multi billion-dollar payment with tiered royalty milestones is most likely. We took our 'independent' market cap projection figures and applied them to the tiered schema. A more comprehensive rationale and conclusion for this segment can be found at the bottom of graphic 3.

  • • If the viewer disagrees with our market penetration assessment of 40%, one could easily alter the market cap values in graphic 3.

      • • Example: If the viewer thinks 20% market penetration is more appropriate in the U.S., simply halve all of the U.S. market estimates in graphic 3. No other work is required.

Bottom-line Up Front (BLUF): On 17 Oct 2024 Anavex issued a press release revealing preliminary results for the 10-day multi-dose part A trial in Schizophrenia. Key results were as follows:

• Dose-dependent effect realized (90mg vs 180mg) 

• Improvements (increase/reversed) over placebo in 2x EEG measures field-recognized as Schizophrenia biomarkers:

  • • 40 Hz Auditory Steady-State Response (ASSR) 

    • Resting State Alpha Power

• The drug was well tolerated with no serious adverse events reported

Commentary:

Most drugs currently approved for Schizophrenia are antipsychotics targeting hyperfunctioning dopaminergic pathways. These drugs come with side effects, and don't properly address multiple aspects of the disorder including cognitive impairment, negative symptoms (i.e. apathy, withdrawal, anxiety, depression, etc.), and treatment-resistant patients (20-30% of Schizophrenic patients). About 1% of all Americans have this illness and globally it is one of the 15 leading causes of overall disability. These patients are at a greater risk of early death and suicide. Schizophrenia is a highly heterogenous disorder - meaning symptoms and physiology varies significantly patient to patient, making treatment and diagnosis a bit complicated.

The most recent drug approved for Schizophrenia is Cobenfy (KarXT) by Karuna, now owned by BMS. This was the first Schizophrenia drug approved with a novel mechanism in over 30 years. While it's mechanism of action hasn't been entirely understood, it's thought by its developers that the drug imparts benefit to patients via its muscarinic-1 and muscarinic-4 (CHRM1 & CHRM4) agonism. The company garnered approval after successfully completing 2x identical studies, EMERGENT-2 and EMERGENT-3. These trials over 5x weeks were both able to show meaningful improvement over placebo in the PANSS assessment. The PANSS assessment is the Schizophrenia gold standard - much like ADAS-COG is the Alzheimer's gold standard for cognition - and its 30-item survey reveals improvements to delusions, hallucinations, excitement, hostility, and more. For the EMERGENT trials, the drug demonstrated a 9.6 point greater reduction in PANSS in EMERGENT-2 (21.2 points vs. 11.6 points) and 8.4 points greater reduction in EMERGENT-3 (20.6 points vs 12.2 points). Interestingly, Anavex 3-71 has strong affinity for muscarinic-1 agonism and SIGMAR-1 agonism. It has been somewhat confirmed through Blarcamesine (Anavex 2-73) development that SIGMAR-1 and muscarinic activation is synergistic. Theoretically, Anavex 3-71 with its strong agonism in both may prove to be as effective or even more effective than Cobenfy, and we will discuss reasoning for this more a bit later. More information on Cobenfy and results for its extended OLE program can be found here. 

No biomarkers are currently specified for Schizophrenia by the FDA; however, a number of biomarkers have been accepted with high confidence by the medical community. Some of these include dopaminergic hyperactivity, gray matter atrophy, inflammatory cytokines, metabolic processes, oxidative stress, some genetic markers, and event-related potentials (ERPs) and quantitative EEG measures - including resting state alpha oscillatory activity and the auditory steady-state response (ASSR). 

Compared to controls, 40 Hz ASSR and resting state alpha power are both consistently and dramatically lower in Schizophrenia patients despite heterogeneity, and both of these biomarkers are changed early in disease progression.  

"ASSR deficits in 30–40 Hz range are suggestive of auditory cortex disturbances. Auditory cortex involvement in SZ has also been indicated by both imaging and neuropathological findings. Reduction of the grey matter volume of the posterior superior temporal gyrus, including auditory cortex, is a consistent neuroanatomical finding in SZ (Shenton et al., 2001). At the cellular level, Sweet et al. (2003) have reported reduction of the volume of pyramidal neurons in the deep layer of primary and secondary auditory cortex in postmortem tissue from patients with SZ."

"Overall, our results clearly demonstrate that the altered patterns of resting-state alpha activity observed in schizophrenia patients can be tracked already before the onset of the psychosis. Specifically, we observe the presence of an altered pattern concerning the resting-state alpha oscillatory activity in the high, relative to the low schizotypy population. Thus, alpha activity seems to represent an important electrophysiological marker, which may likely pave a higher risk of developing schizophrenia spectrum psychopathology."

Conclusion:

The 40 Hz ASSR and resting state alpha power biomarker improvements are especially positive as they present the opportunity to explore early-stage intervention. When combined, the biomarkers potentially address full-spectrum disease needs including positive symptoms (hallucinations and auditory distortions experienced by some 42% of Schizophrenia patients), negative symptoms (irritability and anxiety experienced by 30-65% of patients), and cognitive symptoms (working memory and executive function experienced by up to 85% of patients). Relatedly, while its not being measured in this phase 2 trial, cortical gray matter volume loss is consistently found in Schizophrenia patients - especially in the fronto-temporal region. Greater reductions in gray matter volume link to worse long-term clinical outcomes and gray matter loss has been exceptionally accurate in predicting patient remission status after 6x months on an antipsychotic treatment (79% accurate). Similarly, increased gray matter atrophy predicted a lack of improvement in symptoms over 1 year. Although a different compound, Blarcamesine was able to reduce gray matter atrophy in Alzheimer's patients by 63.5% compared to placebo over 48 weeks. It is highly likely that the SIGMAR-1 component of Blarcamesine was providing most of the degenerative relief in those patients. With that said, it is likely a good idea to include structural endpoints to a future phase 3 Schizophrenia trial for Anavex 3-71. Separately, again in Blarcamesine, Fragile-X rodents treated with with compound saw improvements in alpha wave function in 10mg doses, and alpha, beta, theta, and gamma in 30mg doses. This simply lends further credence to our hypothesis that Anavex 3-71 is likely to provide sweeping benefit in Schizophrenic patients based on previously elucidated SIGMAR-1/Muscarinic synergy - now at very high output with 3-71. A good safety profile addressing the full-disease spectrum (positive, negative, cognitive, and possibly degenerative symptoms) would provide marked improvement over SOC in holistic treatment. Thanks for reading!

Bottom-line Up Front (BLUF): We took available data from AAIC 2024, approximated values based on provided charts, and extrapolated results to week 96. The following analysis is based on substantial assumptions and incomplete/small data and should therefore be viewed speculatively or as a point of analytic intrigue. We were most interested in the ADAS-COG extrapolations in particular as the low and high dose forecasts strikingly resemble those seen in the Anavex 2a trial (figure 2 in link). We postulate that monoclonal antibodies hit a therapeutic ceiling around -1.4 to -1.6 ADAS-COG (cognition). It appears that further development towards this mechanism is unlikely to extend gain much further than what has already been accomplished in Leqembi and Donanemab. Meanwhile, looking at Anavex’s ADAS-COG, CDR-SB, and CGI-I graphs, exponential/further divergence between dosed and placebo groups appears likely as time progresses indicating true disease modification and long-term therapeutic value. Forthcoming unblinded OLE data will assist us to confirm this assessment after its release.

Note: As mentioned earlier, there are significant limitations to this analysis.

Bottom-line Up Front (BLUF): Anavex's cognitive data is the best available amongst registrational-level and already approved monoclonal antibodies. Not only was the high dose (50mg) able to perform better than existing Aduhelm (Aducanumab), Leqembi (Lecanemab), and Kisunla (Donanemab) - the pooled 30mg + 50mg group also performed superiorly and met established cut off scores for clinically meaningful improvements to patients. Separately, Blarcamesine reduced grey matter atrophy so significantly that patients are in-line with historically observed volumes in non-impaired 75-year-olds, and reduced whole brain atrophy to levels very close to non-impaired 75-year-olds. Considering two additional deaths due to ARIA in the Leqembi OLE, historical record between the FDA and Eli Lilly requesting accelerated approval on phase 2 results, and Anavex's most recent results from AAIC 2024, our confidence that Blarcamesine will almost certainly be approved by the EMA and likely by the FDA remains steadfast. 

ADAS-COG:

In graphic 1 we display ADAS-COG scores from five separate trials spanning four separate drugs. Anavex's scores in blue represent by far the best outcomes. Blarcamesine 50mg dose performed 41.38% better the Donanemab's best cohort (low/medium tau), and 53.5% better than Leqembi and Aduhelm. Not only that, Anavex's scores fall well within established MCID (clinically meaningful) criteria for noticeable patient improvement as indicated in purple. Results were more efficacious, found in a patient population representing the whole Alzheimer's community (<10% screen), and was seen 28 - 30 weeks earlier than previously mentioned antibodies. Dr. Missling has previously mentioned in conference call that the EMA petitioned Anavex to submit for approval after seeing their cognitive data specifically, and we can certainly see why.

Grey Matter Atrophy Charts Over Approximately One Year:

In graphics 2 & 3 we display grey matter atrophy rates in four patient populations. In green there is historical data for non-impaired 75-year-olds, in blue there are the Blarcamesine-treated patients, in red is historical data for early-stage Alzheimer's patients (75-year-olds), and in orange are the Anavex 2b/3 placebo patients. To our knowledge there has never been a registrational-level Alzheimer's drug capable of lowering grey matter atrophy to regular non-impaired levels. Grey matter is key for processing and interpreting sensory signals, muscle control, memory and the hippocampus. Changes in grey matter volume and structure have been linked to Alzheimer's disease, schizophrenia, depression, multiple sclerosis, and other neurological disorders.

Whole Brain Atrophy Charts Over Approximately One Year:

In graphics 4 & 5 we display whole brain atrophy rates in four patient populations. In green there is historical data for non-impaired 75-year-olds, in blue there are the Blarcamesine-treated patients, in red is historical data for early-stage Alzheimer's patients (75-year-olds), and in orange are the Anavex 2b/3 placebo patients. As indicated by the chart, Blarcamesine reduced whole brain atrophy by 37.6% compared to placebo, bringing dosed patients very close to the higher range of non-impaired 75-year-olds. Meanwhile, placebo patients declined in-line with historical early-stage Alzheimer's patients of comparable age (75-year-olds). The whole brain refers to all segments of the brain as a comprehensive system rather than specific sub-systems. This typically includes the limbic system, brainstem, cerebellum, and cerebrum. 

Conclusion:

After Eli Lilly completed their phase 2 clinical trial of Donanemab, the company submitted for accelerated approval at the FDA under the grounds that the drug dramatically reduced amyloid in the brain. The FDA politely rejected the submission, requesting Eli Lilly to provide data from at least 100 patients who received a minimum of 12 months of continued treatment on Donanemab. The FDA indicated to Eli Lilly that they would consider OLE data as part of the drug exposure expectation. In the Anavex 2b/3 trial, at least 165 dosed patients provided brain MRI scans for atrophy at week 48, and 191 dosed patients completed ADAS-COG assessment at week 48. Taking into account Eli Lilly's experience with their accelerated approval submission, it appears likely that Anavex would be considered for accelerated approval using neurodegeneration (atrophy) as a biomarker, having acquired over 100 samples at nearly 12 months. When this atrophy data is combined with impressive ADAS-COG cognitive data (which will have 48 blinded weeks and 96 unblinded weeks - 84 weeks of which is at optimal dose after lengthy titration schema), requirements set by the FDA appear to be largely met. While we can't quantify the impact, we assess the acceptance and probable future approval by the EMA will have some degree of weight on the FDA. 

Overall, Blarcamesine removes built-up waste (including amyloid and likely tau [trended]) & inflammation, repairs axonal guidance & neuronal networks, regenerates energy transfer systems and cellular function, and builds up innate resilience to chronic pathologies over long timeframes. These functions provide clinically meaningful cognitive benefit, brain preservation, and addresses classic Alzheimer's metrics like amyloid and tau. Perhaps most importantly, future longitudinal modeling will enable Anavex to display 'time saved to patient' metrics, showing both impact to disease stabilization, and overall lifespan. 

As existing monoclonal antibodies continue to demonstrate significant safety issues (death by ARIA) in the real-world Alzheimer's population, the need for an easily administered, orally available, efficacious, safe, and inexpensive option continued to be a pressing global need. We look forward to a topline OLE readout in the near future, the upcoming CTAD presentation on S1R gene findings (silver sponsor for event), peer-reviewed 2b/3 data, EMA submission, and potentially future longitudinal 'benefit to patient lifespan' analysis. 

Bottom-line Up Front (BLUF): This brief report serves as a follow-up to our 7 April 2024 publication regarding the FDA's Early Alzheimer's Draft Guidance [downloadable here]. Public and private comments for the guidance closed on 14 May 2024 and we expect final guidance to be issued later this year. Excitedly, on 17 May 2024, the Regulatory Affairs Professionals Society (RAPS) published an article titled "Stakeholders provide feedback on FDA draft guidance on drug development for early Alzheimer's disease". This article covers public comments by Johnson & Johnson as well as Spirit of the Coast Analytics and can currently be found on their Regulatory Focus homepage or specifically at this link. Even if omitted from final guidance, we are pleased that our focus on brain atrophy as a key marker of degeneration makes greater public stride and at least became a consideration piece for the U.S. regulator agency.

About Regulatory Focus: "Regulatory Focus is the only source of independent, quality regulatory news, information and analysis that is fully dedicated to covering the issues associated with healthcare products and the regulatory profession. From guidance documents, regulations, rules and international guidelines to legislation, enforcement actions, legal decisions, business trends and more, Regulatory Focus covers everything you need to continue advancing public health."

Bottom-line Up Front (BLUF): The 9 May 2024 second quarter financial call was a step above in breadth and quality over most previous conference calls. There are a number of exciting developments & milestones expected over the next few months that should keep most investors interested. Within the conference call, Dr. Missling hits on operation timelines, EMA filing status, biomarkers and FDA guidance, Rett syndrome trial rework, and more. We apologize for the late report and thanks for reading.

Big Rocks:

1. Anavex 2b/3 Alzheimer's interim genomic data expected mid-year (2024)

2. Anavex 2b/3 Alzheimer's OLE data expected 2H 2024

3. Rett Syndrome expected to continue in a P3 12-week trial

4. Parkinson's 2b/3 6-month initiation expected 2H 2024

5. Fragile-X biomarker data is set to be presented from 25 - 28 July 2024

6. Anavex 3-71 Schizophrenia trial ahead of schedule, and the Part A cohort has been enrolled

Q&A Segment:

7. In the first question by Jones Research, the analyst inquires into the forthcoming FDA Early Alzheimer's Draft Guidance. Specifically, the draft guidance allows for ADL omission at the cost of "strong biomarker data". So is the plasma amyloid 42/40 improvement (p=0.05) strong enough to meet this guidance threshold? Dr. Missling does a really nice job answering this question, explaining that there was a positive amyloid effect in all patients, and that the company was surprised by the effect simply because Blarcamesine is not a monoclonal antibody with an anti-amyloid mechanism of action - it's not designed to address amyloid. However, the drug works upstream of amyloid, meaning it addresses the root issues of downstream pathological effects like amyloid even without direct confrontation. He goes on to say that whether the amyloid 42/40 data hits the undefined draft guidance threshold is currently unknown; however, the company boasts another biomarker with high statistical significance - brain preservation through dramatically reduced atrophy (p=0.0001 in whole brain). Dr. Missling then states that the brain atrophy data is really impressive because it is a direct measure of disease progression, and is an underlying cause of disease, whereas the amyloid is more of a biproduct. In all cases, the company can combine amyloid and brain preservation to come to some very strong synergistic conclusions with compounding effects. Finally, he impressed that these benefits have all been seen over standard of care, making this effect even more impressive.

8. In the second question, the Jones Research analyst asks about open label data and filing timelines. Dr. Missling states that having 96 week safety data would be favorable when approaching the FDA, and that because it is open label they could expedite this by looking at interim safety data at say 76 or 82 weeks rather than waiting for all 96 weeks. For the EMA, the Anavex team is working overtime to complete the package modules. He states that the company is well on track to file this year and will provide better update the closer they are to filing. In the 6 May 2024 Spirit of the Coast update, we left it open to slight possibility that the company was nearing completion of the EMA package. With this likely not being the case, we quickly redact our EMA approval timeline, no longer seeing a real possibility of approval in 2024. With accelerated assessment - with which we assess the company has a high chance (89%) of garnering - we believe 2nd or 3rd quarter 2025 approval looks most likely. 

9. For the third question the HC Wainwright analyst doubles down on EMA filing, when will it be filed and how deep is the CHMP currently involved in review? What are the main criteria they will use for approval in the EU? Dr. Missling states that the company is filing as soon as possible and will be done definitively this year. There have been interactions with EMA to ensure the company is building the package in congruence with their standard. It is notable that the EMA saw most of the 2b/3 data and the EMA requested the company files for approval expeditiously, "immediately". Dr. Missling mentions that the EMA probably requested this due to unmet need in the EU, and lack of MRI/PET centers in many EU nations like Romania and Poland. There are copious peer review articles over the last 5 years confirming the EU's need for a safe, cost effect, non-monitored Alzheimer's therapeutic to address these very facets. Romania is an excellent example, and one that I am familiar with. Viewers with more interest would find this article helpful published in Feb 2024. The following excerpt is especially helpful to understand the situation: 

"If European regulators impose similar eligibility conditions as the FDA, patients will require biomarker confirmation of amyloid pathology in the brain, currently measured using PET scans or lumbar puncture tests. There may also be a requirement for genetic testing, to establish patient ApoE4 status. In addition, European payers may ask that patients are enrolled in a registry to obtain coverage, similar to payers in the US. Treatment with current formulations of anti-amyloid drugs will involve monthly or bi-weekly intravenous infusions in specialist clinics, with regular monitoring involving MRI scans and other medical evaluations. If infusion reactions or side-effects such as ARIA occur, hospitals and emergency medicine teams will be required to manage and treat symptoms. Together, these clinical interventions will require a range of specialised personnel and infrastructures, from neurologists, neuroradiologists and genetic counsellors to PET scanners, MRI units and infusion centres. Defined clinical care pathways, standardised ARIA detection, monitoring and management protocols, as well as tools, training and guidelines for healthcare professionals, will also be required to ensure timely and effective treatment.

Currently, European healthcare systems are not resourced, equipped or organised to provide equitable access to anti-amyloid drugs for all people with early AD. Access to approved, symptomatic treatments for Alzheimer’s dementia already varies between countries, with only 26% of low- and middle-income countries and 76% of high-income countries including these drugs in national schemes for full reimbursement."

10. For the fourth question, the HC Wainwright analyst inquires as to how the company will monitor 3-71's efficacy in Schizophrenia, and how different 3-71 is expected to be from current anti-psychotic medications. Will the drug be more efficacious, easier to prescribe, safer, or perhaps a combination of these? Dr. Missling states that company is focusing on EGERP as a biomarker. This was an outcome tested in the COGNISION consortium Anavex participated in a few years ago. The company hopes that the outcomes of the ongoing phase 2 trial will inform how the drug will be differentiated from existing molecules.

11. For HC Wainwright's last question the analyst wonders if the EMA approves Blarcamesine for Alzheimer's in the EU, what will Anavex's strategy be to commercialize or partner, and does the current cash runway provide enough startup funds if they are to solely commercialize without a partner. At this point, Dr. Missling says that they are most interested in shareholder value. If the company can find a very active partner with large bandwidth and ability to maximize sales while incentivizing the company with upfront payments, milestone payments, and royalties, then this is the route to take. However, if this is not the case, there are split marketing opportunities. Based on how Dr. Missling answers this question, it is likely the company is waiting until approval to finalize a deal, as this would secure the most favorable terms for Anavex and its shareholders. Currently the company is not including advertising or commercialization startup costs in the cash runway, but there are non-dilutive ways to garner such funds in the event the company commercializes alone. 

12. BI Research then asks the sixth question, inquiring into the Schizophrenia trial design and data expectation. Dr. Missling states that there are several cohorts in the Szhiophrenia trial and the first such cohort has been fully enrolled - and well ahead of schedule. The first part of the trial is a dose finding trial, and the second part is an efficacy portion with optimized dose. The data timeline will be coming later when the trial is closer to completion.

13. The BI Research analyst then asks about the upcoming Rett trial and expectations there. Dr. Missling confirms that the trial really only failed due to a high placebo effect and 2:1 dosed vs. placebo arm. Because of this 2:1 ratio, caregivers assumed they were on the drug, thus increasing caregiver and physician placebo rates. For the upcoming trial the company will swap to a 1:1 ratio to reduce placebo noise, and will also refine clinical outcomes. The trial is expected to be 12 weeks and the company is engaging the Rett community to garner interest in the trial. If interest is high, the company will accelerate trial initiation and possibly bump the trial enrollment numbers accordingly. 

14. To highlight Fragile-X, the BI Research analyst asks where the company is at with the indication and if more can be said about the upcoming 2b/3 trial. Dr. Missling states that the biomarker they have correlates very clearly with Fragile-X pathology, and this data is expected to be presented in July. It is likely Dr. Missling is referencing peripheral lymphocyte signaling, which was first elucidated in the 8 June 2022 company PR with accompanying peer review article reference - though we leave the possibility of a second biomarker previously unmentioned. The biomarker allows the company to initiate a 2b/3 with Fragile-X. Having a firm, scientifically sound, and measurable biomarker helps enrollment processes as patients have a molecular outcome to spur on excitement. 

15. Finally, BI Research opines over the AVXL share price and pontificates that the company should consider insider-buying. Dr. Missling is obviously less-than-pleased over the share price, but the company has no debt, has a great team, continues hiring, and continues expanding their pipeline and trial progress. Additionally, the company is currently in a closed buying window, preventing insiders from purchasing at this time. 

Conclusion: As mentioned in the BLUF, there is a lot to look forward to for the rest of the year. Spirit of the Coast Analytics is most excited for the finished 2b/3 peer review and early genomic data (which could both come as early as mid-2024, a window we are currently in). Another standout milestone would be EMA submission, and possibly even FDA submission by the end of the year. It is refreshing to see Fragile-X and Rett Syndrome continue, and of course we can look forward to the long-awaited Parkinson's disease trial initiation and Anavex 3-71 Schizophrenia data. Over previous calls, this financial call gave good insight into current Anavex operations with better defined timelines and expectations. Based on new EMA filing progress and the company's continued module compilation, we assess it is likely the company will see EMA approval mid-2025, likely with accelerated assessment as the EU struggles to equip physicians with safe, efficacious therapies. 

Bottom-line Up Front (BLUF): The following Q&A covers a variety of topics related to ongoing Anavex operations. I have been asked many of these questions privately. These answers are my absolute best guess based on extensive research and conversations with industry experts. 

1Q: Can you provide an overview of the 2b/3 Alzheimer’s trial? What is the significance of responder analysis? 

1A: Anavex needed to meet co-primary endpoints in the 2b/3 Alzheimer’s trial. These endpoints were ADAS-COG (cognitive) and ADCS-ADL (activities of daily living). The primary statistical analysis was for combined 30mg+50mg dosed cohorts vs. placebo. The ADAS-COG was met nicely, while the ADCS-ADL failed to meet statistical significance. Luckily, it was pre-established that ADAS-COG could be anchored to the key secondary endpoint - CDR-SB (global) – which was met, and thus allowed for a successful trial designation. 

As previously mentioned, the primary statistical analysis was for pooled 30mg+50mg cohorts. Because the anchored endpoints were met, further pre-established sub-analysis can be explored. Primarily, this sub-analysis would include breaking out 30mg and 50mg vs. placebo, as well as a patient co-morbidity analysis, S1R gene analysis, sex & age, etc. 

Regulators like the FDA and EMA are most likely to base approval decisions off the primary analysis (pooled 30mg+50mg), but valid pre-established sub-analysis will likely play a smaller piece in their conclusions. Where sub-analysis for responders really shines is in the commercialization stage post-approval. Physicians will be able to prescribe Blarcamesine to a vast array of patients based on previously established gene/disease-stage analysis (80%+). By breaking out a high-confidence responder criteria, physicians can inform patients early on as to their odds of improving (reversing cognitive decline). 

So again, while responder analysis is important for commercialization-stages, the primary analysis being analyzed by the FDA and EMA is the pooled 30mg+50mg cohort. It is almost certain the earlier disease stage, higher dose (concentration), S1R WT, and time-on-drug, are primary factors as to whether a patient improves over baseline during therapeutic intervention. In a totally unlikely hypothetical case, if all 30mg patients totally failed the trial, but the 50mg patients carried the pooled group to success, only the 50mg dosing would be approved in the clinic. What’s important is that the combined dosing arms passed the trial. 

Additional note: It is likely that ADCS-ADL trended favorably, but simply failed to meet statistical measures in MMRM.

2Q: In your opinion, what is the significance of brain atrophy data? What are the biggest delineations or advantages of Blarcamesine over big pharma monoclonal antibodies? 

2A: Quite simply, brain atrophy has significant ties to cognitive loss and life span. Compared to healthy aging adults, Alzheimer’s patients with atrophied amygdala have a 315%+ greater likelihood of death and similarly a 220%+ greater likelihood with atrophied hippocampus. Every 1% of annual whole brain atrophy over standard aging humans increases the odds of progressing to the next stage of dementia by 30%. To my knowledge, Anavex is the only company to halt brain atrophy during a pivotal trial. In fact, monoclonal antibodies exacerbate further brain atrophy. Dr. Missling mentioned a few investor conferences ago that the company may have even reversed atrophy in some cases. In my studies, there is very little literature mentioning atrophy reversal, so it’s likely that Anavex will focus on the preservation/halting over reversal which hasn’t been fully elucidated. Beyond brain preservation, other advantages setting Blarcamesine over the antibodies (Aduhelm, Leqembi, Donanemab) is the fact that the therapy is a small molecule and orally available. There have been improvements in the full ATN (amyloid, tau, biomarkers of degeneration) with a good safety profile void of ARIA (brain swelling and brain bleeding) and the ability to show substantial clinically meaningful benefit over baseline in ideal patients - which is theoretically most people. 

Something especially key to hone in on is addressable market. The antibodies established amyloid thresholds as part of their recruitment process. Tens of thousands of patients were excluded from these trials to enroll only the most ideal patients for the drug mechanism of action. While this resulted in ‘successful’ trials, it also resulted in a very small addressable market, because the drug can only be prescribed to patients meeting the stringent threshold tested in their respective pivotal trials. Meanwhile, while Anavex tested for amyloid+ confirmation during enrollment, none of their analysis was dependent on specific amyloid enrollment threshold – thus, the drug will be feasibly prescriptible to all patients in early stages. Combining an antibody black box warning (safety warning), you can see how advantageous Blarcamesine is in comparison to the antibodies for addressable markets. 

More can be read about brain preservation here.

3Q: What is Dr. Sabbagh’s (Chair of the Scientific Advisory Board) relevance at this stage?

3A: Dr. Marwan Sabbagh has been involved in hundreds of Alzheimer’s-related peer reviewed publications. His prolific reach and influence in the field is certain to carry a heavy weight during the 2b/3 paper publication. Based on my personal experience meeting Dr. Sabbagh at AAIC 2023, I see him as a strong asset with dominant opinions and the willpower to pursue strategies he feels will extrapolate a best outcome for Anavex. He likes to attach himself to emerging technologies and medicines in the Alzheimer’s space and being brought on as the SAB Chair speaks volumes to the talent Anavex can garner. It is likely that he was enticed by Anavex’s unpublished data and wanted to be a part of something exciting. 

4Q: Why do you think the EXCELLENCE trial missed its endpoints, what do you think next steps will be?

4A: The EXCELLENCE Rett trial likely missed its endpoints due partially to trial design and strong placebo response. Factually, 2/3 of the trial participants were on the drug due to the lopsided dosed vs. placebo arm weighting. This likely prompted caregivers and physicians to assume their child/patient was on the intervention – as it was statistically more likely to be so. It is notable that during the Trofinetide trial, over 80% of patients experienced diarrhea, which unintentionally resulted in a pseudo-unblinding. If patients experienced diarrhea, caregivers knew that they were on the intervention, resulting in a much lower placebo response as Rett communities are tight-knit and were certainly discussing results mid-trial. Blarcamesine has no such ‘tell’ and therefore a complete blinding was maintained. It is extremely unfortunate that Blarcamesine missed endpoints in EXCELLENCE, as the drug already showed efficacy in two prior Rett trials. It is likely that the company weighed whether an unmet need still existed post-Trofinetide. Considering Dr. Missling recently confirmed a follow-on trial, a need certainly still exists, and I assume the next trial will have higher power with a more even placebo vs. intervention grouping. I look at the EXCELLENCE miss as a roadblock, not an end to the Rett indication or follow-on rare diseases. 

5Q: Why do you think Anavex hasn’t partnered yet, do you have any thoughts on partnership?

5A: Quite frankly the SIGMA-1 (SIGMAR1, S1R) mechanism of action is still unique/novel. The peer-reviewed 2b/3 Alzheimer’s paper will be extremely important to cementing Anavex’s mechanism and reputation. It is my opinion that the paper – probably headed by Dr. Missling and Dr. Sabbagh – will be of absolute criticality to a future partnership. It is likely that Dr. Sabbagh’s probable prominent role in the paper will be instrumental in this goal considering his reputation and rigor in pursuing promising therapeutics. It is my best guess that Eli Lilly or Sanofi will be Anavex’s eventual partners and partnership is possibly to be solidified sometime around EMA/FDA submission or EMA/FDA approval. I have very little to go on as far as how the deal will be structured but will most likely include some sort of upfront payment and royalties.

6Q: Have you noticed the strange divergence at week 12 in the ADAS-COG and CDR-SB linear charts featured in the company update presentations?

6A: Yes, it is notable that the company was up-titrating up until week 12, which probably had a lot to do with this divergence – making it appear as though placebo was performing better than Blarcamesine. The good thing is this divergence was not statistically significant and subsided as soon as the up-titration phase ended. As a general note for all Alzheimer’s trials, modern patients are more learned than in the past - even a decade ago. As a result of excellent whole-intervention trials like FINGERS, patients now more than ever begin sweeping lifestyle changes to stave off disease progression. During early stages of a clinical trial, patients and caregivers are more likely to succumb to placebo effect. Caregivers are hypervigilant to changes in their loved ones, and lifestyle changes including diet and physical fitness improve patient outcomes for a time, especially in MCI and early-Alzheimer’s stages. This is why longer trials are better in the Alzheimer’s indication. I look forward to seeing similar charts in the 50mg-only, and responder-only sub-analysis. 

7Q: What do you think about Parkinson’s trial initiation speed?

7A: The pivotal Parkinson’s trial has certainly been initiated in less than spectacular time; however, this is probably due to emerging biomarkers and assays in that field. This is probably related to a desire to be thorough, rather than an inability of management to execute. 

8Q: Have you made any recommendations or suggestions to Anavex recently or in the past?

8A: I have sent email suggestions a few times in the past. One of the topics I've emailed about was tying brain atrophy to life extension or ‘’time saved in early disease stage’. The FDA representative at AAIC 2023 mentioned this metric was a going interest to the agency. In addition, I have emailed the company my opinion about drug pricing, public perception, 2b/3 data release methodologies, and facets revolving around emerging FDA guidance on early Alzheimer’s clinical trials. 

9Q: When do you think the EMA may approve the Alzheimer’s indication?

9A: Considering what I believe to be true regarding Anavex’s regulatory submission and progress, I believe at an earliest the drug may be approved by the EMA in December 2024; and more likely, in the first or second quarter 2025. I believe the chances of approval are high and give about 89% likelihood it will be done under accelerated assessment conditions. Separately, it is likely Anavex will wait to file with the FDA until their 2b/3 OLE concludes, and the pending early Alzheimer’s draft guidance is finalized. Note: SOTC Analytics focuses primarily on scientific aspects of company development. Any number of administrative actions could push approval to the right of our proposed timeline. Investors and stakeholders should assess their own timelines for drug approval. Additionally, we use likelihood language established in ICD 203, which is perhaps not well known by many viewers. It can be found on page 3 here.

Conclusion: I look forward to the peer review paper – which is likely headed in part by Dr. Sabbagh – and believe its publication will be of massive benefit to the company’s reputation and partnership prospects. I have high confidence this paper will be released in 2024. With the recent Annovis data release and all publicly available information on antibody trial data, it is resoundingly obvious that Anavex currently boasts the most promising proven cognitive data in Alzheimer’s. I have personally made stock purchases over the last month in support of this belief. Spirit of the Coast Analytics will likely incorporate later this year, and we look forward to continuing analysis of Anavex Life Science Corporation and emerging sciences in the CNS-sector. 

Bottom-line Up Front (BLUF): The following are first impressions of Annovis's most recent Alzheimer's data. My impression of their previous Alzheimer's data released at AAIC 2021 was mixed but mostly negative on account of presentation disorganization and data inconsistencies. The company had a chance to refine their approach with this phase 2/3 trial, which appears to have suffered similar blunders by management, primarily in trial design. Not all aspects of the data release were negative - despite the 56% hit to the company market cap at time of writing - so let's explore and see what kind of conclusions we can draw. The PR released 29 April 2024 can be found here.

Trial Enrollment & Design: 

Perhaps the most perplexing aspect to the 2/3 trial design was the enrollment process. Below you will find an excerpt from the PR verbatim:

"Our initial recruitment did not prescreen patients for AD biomarkers in plasma. When we became aware of issues from other AD studies with sites recruiting non-AD patients, we fast-tracked biomarker measurements by collaborating with C2N Diagnostics. This enabled us, when we unblinded the data, to tell which patients had confirmed AD and which did not (Ashton et al. JAMA 2024, Barthelemy et al. Nat. Med 2024, Meyer Alzheimer’s Dement 2024). Out of 325 patients who completed the Phase II/III trial, 202 had a ratio of pTau217/tTau≥4.2% that indicates AD. We further subdivided the patient population into moderate (MMSE 14-20; 112 patients) and mild (MMSE 21-24; 90 patients) AD patients. These two selections were not pre-specified analyses."

The company expedited enrollment by skipping initial biomarker analysis. Biomarkers, primarily amyloid - and tau to a lesser degree - are often used to confirm Alzheimer's diagnosis in patients and is a standard screener for Alzheimer's trials. Instead of screening immediately, the company enrolled 353 patients without the biomarker screening and screened them as they progressed through enrollment, thus masking the results which could be uncovered during the post-trial analysis. 

Notably, Annovis used tau (lesser used biomarker for Alzheimer's confirmation) as the biomarker, and found that of the 325 patients to complete the trial, only 62% (202 patients) met the criteria for Alzheimer's. This indicates the company enrolled 151 patients that did not have Alzheimer's by their own metric analysis. Additionally, the 202 actual Alzheimer's patients were subdivided into mild and moderate stages (90 mild, 112 mod), but this was not a part of pre-specified analysis which is surprising.

Primary Endpoints: 

The company used ADAS-COG (cognitive) and ADCS-CGIC (global) as their co-primary endpoints. For those not familiar with endpoints, the ADCS-CGIC global endpoint tests cognitive and activities of daily living. If it is helpful, the reader can compare it similarly to CDR-SB used in many large Alzheimer's trials.

Remember that the subdivided mild and moderate stages mentioned earlier were not a part of pre-specified analysis. Based on the PR, the drug failed to meet statistical significance in the primary analysis (pooled mild and moderate Alzheimer's patients). However, the drug did meet statistically significant improvement in all doses (7.5mg, 15mg, 30mg) against placebo in the early Alzheimer's group. The results in early Alzheimer's showed dose-dependent effect, with the largest dose of 30mg showing a -3.3 point improvement (reversal). However, the placebo group also improved, and so compared to placebo this improvement is reduced to something around -2.4 point improvement over placebo. This is very respectable; however, notable that the primary analysis failed and the sub analysis was not a part of pre-specification. 

The ADCS-CGIC global endpoint failed entirely, showing only minor, non-statistically significant improvement in the 15mg and 30mg group.

Key Secondary Endpoints & Biomarkers: 

The company used ADCS-ADL (activities of daily living) as a key secondary endpoint, which failed. It is not uncommon for ADL to fail in very early Alzheimer's patients; however, in the 202 Alzheimer's patients enrolled, more than half were in the moderate stage. Because of this, a beneficial result theoretically should have been possible. There is no mention of the moderate-only stage effect; therefore we can conclude that it is likely there was no meaningful benefit even in the moderate group.

The tTau biomarker (neuronal or axonal damage) was improved in all 3x doses in the 202 Alzheimer's patients when compared to placebo. There is no mention as to whether the improvement was statistically significant, but this metric is not as important in my opinion for the tTau measure. Overall, I see the tTau biomarker as a positive. The company says they will present some other biomarker data in inflammation, axonal, and synaptic function. We can theorize these biomarkers would include possibly NFL, GFAP, and a few others. Intriguingly, the company did not make mention of assaying amyloid and it is not listed on clinicaltrial.gov. 

Responders & Safety: 

The company showcases dose-dependent response compared to placebo, which does look promising. At 30mg, the number of responders vs. non-responders is extremely obvious, with 87.5% response rate as opposed to 12.50% non-response rate. Once again however, this is only considering the early Alzheimer's patients. When combining all 3x dosing groups and assessing for only early Alzheimer's patients, 72% of patients were 'responders', which without explicitly stating so, we take to mean that they improved on ADAS-COG over baseline.

The drug was reported to be safe and consistent with previous trials. Adverse events were comparable between dosed and placebo, and were mild or moderate in severity.

Conclusion: Annovis's unusual trial enrollment scheme and non-inclusion of disease-severity sub analysis really hindered their ability to showcase clinical efficacy. Only 62% of the enrolled patients even had Alzheimer's at all as quantified by the company's analysis of tau screening. Positively, the drug appeared to show very nice improvement over baseline in the ADAS-COG cognitive assay, as well as compared to placebo - albeit in a very short trial. Tragically, the co-primary global endpoint failed to show statistical significance, and the key secondary endpoint of ADCS-ADL failed to show statistical significance as well, even in the moderate-stage patients that likely were capable of showing variance. Unfortunately, most efficacy appeared to be found solely in the 90x patients early-stage Alzheimer's group. Due to unusual enrollment, sample size for the trial and ideal patient population was low. It is also unusual that the company did not seemingly plan to assay the amyloid biomarker. Overall, Annovis has an absurdly lacking cash fund and in order to run a larger planned phase 3 trial, they will likely require further dilution or partnership. It is possible that success in their current Parkinson's disease trial will help them accomplish this goal. In all cases, the company appears to need assistance in trial design and may be a reflection of management.

Bottom-line Up Front (BLUF): A few weeks ago, the FDA published draft guidance for Early Alzheimer's disease. The guidance makes marked improvements for very early stage trials by placing greater emphasis on pathophysiological changes (measurable changes in the brain as a cause of disease), and negates the need for the activities of daily living metric. Overall, the draft is favorable to Anavex Life Sciences and a myriad of other developers. Below you will find a link to the draft guidance (downloadable), as well as a link to Spirit of the Coast's official comment to the FDA in order to improve upon the draft. Our feedback primarily revolves around specificity on desirable physiological changes with emphasis on those that are most likely to extend patient lifespan (brain atrophy).

• Draft Guidance

• Spirit of the Coast Comment

Bottom-line Up Front (BLUF): Within this report we make comment on various points of interest: ADCS-ADL success, the tau biomarker, the arterial spin labeling endpoint, possible gender-dependent effect, SIGMAR1 mRNA levels, odds ratio and effect sizes, placebo effect, and time-saved as result of therapeutic intervention. These are subjects we've researched over the last couple of weeks and wanted to wrap up here as separate-but-related points of interest. We hope to spark interest in readers as we all wait for Anavex's full 2b/3 dataset.

Gate Keeping

To clarify SOTC stance on the ADCS-ADL endpoint, it is our opinion that ADCS-ADL more likely than not met statistical significance as a standalone primary endpoint (p=0.05 or better), but did not meet the threshold needed as a co-primary endpoint (combining ADAS-COG and ADCS-ADL to reach p=0.05 together). Based on our research, it appears that the results are a waterfall. What is meant by this is, for the ADAS-COG to be combined with CDR-SB, the ‘first measure’ must be met. In this case, the first measure being both ADAS-COG and ADCS-ADL were met at the p-value of 0.05 (separately). 

Gate keeping procedures indicate that both ADAS-COG and ADCS-ADL did in fact reach 0.05 separately; however, that’s not good enough to claim success outright because the scores are supposed to be combined to meet 0.05 (i.e. both need to be 0.025 to add up to 0.05).

Thus, as was pre-prescribed in the SAP, Anavex could use the gate keeping measure (because both co primary endpoints were stat sig separately) to try to come to a truly successful trial (0.05 or lower when combining two endpoints). They were able to do this with the CDR-SB and ADAS-COG because the first measure (ADAS-COG and ADCS-ADL meeting at least 0.05 separately) was met. 

Gate Keeping Conclusion: it is more likely than not that ADCS-ADL met statistical significance somewhere between 0.05 and 0.0275. Our confidence is increased by the fact that the company's latest 10-series filings reiterate that the ADAS-COG and ADCS-ADL endpoints were both met. 

There are two fundamental truths:

1. According to the CTAD PR and subsequent 10-series filings, the trial met both co-primary endpoints; ADAS-COG and ADCS-ADL. This implies both endpoints were met with at least 0.05.

2. The second truth is that the trial was a success because of the ADAS-COG and CDR-SB reaching 0.05 combined. This implies that ADAS-COG and ADCS-ADL could not reach 0.05 when combined.

We look forward to the eventual release of the mean-scores for ADCS-ADL in the pooled dosed cohorts as has already been released for ADAS-COG and CDR-SB.

Tau Levels

Plasma (blood) T-tau and CSF P-tau/T-tau were collected as biomarkers in Anavex's 2b/3 Alzheimer's trial. We have yet to receive any information regarding tau and Blarcamesine's therapeutic effect on the proteins. Tau association to brain atrophy has now been elucidated in multiple peer reviewed papers - not just for Alzheimer's, but also in other tauopathies like stroke, corticobasal degeneration, lewy body dementia, frontotemporal dementia, and more. In all of these tauopathies, tau increase is correlated to an increase in brain atrophy. This is unsurprising as tau is largely associated with 'brain injury'. With the knowledge that Blarcamesine dramatically slowed or ceased atrophy in the whole brain, it is likely that the drug had a beneficial effect on tau as well. In preclinical studies, Blarcamesine has already shown to block or decrease tau levels by altering p35 levels, and thereby reducing CDK5 dysfunction. Further information on CDK5 can be found throughout the SOTC site; but as a brief reminder, dysfunctional CDK5 is disastrous to the CNS and its substrates are related to at least 39 key functions such as BACE1 expression, Parkin activity, synaptic plasticity, axon formation, tau, and more. Blarcamesine has been shown to correct or reverse CDK5 levels in Alzheimer's and PDD patients.

Tau Levels Conclusion: By virtue of known atrophy prevention/slowing and corrected CDK5 levels in earlier patients, it is highly likely that tau levels were improved in the 2b/3 Alzheimer's study.

Arterial Spin Labeling 

Beyond structural MRI, the company assayed cerebral blood flow (CBF) utilizing arterial spin labeling (ASL). ASL is an ingenuitive way to quantitatively and objectively track blood flow in a patient's brain by magnetizing water in the blood and then tracking the blood. The blood amount is then divided against the mass of the brain tissue it was tracked to in order to compute a value. Blarcamesine has demonstrated effect towards hypertension normalization, having corrected systolic blood pressure in the 2a trial participants. Irregular systolic blood pressure damages arteries, causes heart disease, kidney damage, and stroke, and has been implicated in an increased risk of cognitive decline and dementia. 

Arterial Spin Labelling Conclusion: Efficient CBF is needed for proper brain function, ensuring supply of oxygen and energy substrates. In addition, and possibly more importantly, efficient blood flow helps to clean out the accumulation of dead or misfolded proteins in the brain. Accumulation of dead, misfolded, or zombie (senescence) proteins impair energy (ATP) output and cause neuroinflammation. Healthy CBF reduces brain atrophy, and it is likely this measure was successful in the 2b/3 trial - especially in the 'responder' population.

Gender-dependent Effect

We feel we’ve done a good job in previous reports explaining factors influencing Blarcamesine’s efficacy. Most of these factors were discovered in the Alzheimer’s 2a trial such as: S1R WT gene, earlier disease stage, APOE3 genes, drug concentration, and time on drug. It was also indicated that males had a higher tendency to perform better than females; however, this was not statistically significant. Because of this, it’s likely that males do perform better or have higher odds of responding to treatment, but both genders maintain good/excellent compatibility with the drug.

As we know, females have higher odds of all-cause dementia over males, especially as they reach menopause. We also know that S1R mRNA expression is reduced in women, and S1R expression appears to be enhanced by estrogen. As menopause reduces estrogen, S1R also lowers in conjunction.

Newer evidence published on 25 Jan 2024 revealed gender-based differentiation in the basal forebrain cholinergic system (BF / BFCS) during CNS degeneration. The cholinergic system is important to Anavex’s MOA as the muscarinic receptor agonism is dependent on the health/state of cholinergic regions. If the basal forebrain cholinergic system is atrophied, there is less acetylcholine to stimulate muscarinic and nicotinic receptors. Luckily, even with significant atrophy, Blarcamesine would still be partially effective with its S1R role and dampened M1-M4 ability. Within the report it was noted that:

• Normal aging has minimal effect on basal forebrain volume 

• Basal forebrain volume reduction is a biomarker for diagnosing neurodegenerative disease 

• Asymmetric atrophy was observed in subregions of the basal forebrain in female patients as opposed to male patients 

Below are various excerpts from the research, with especially important portions highlighted in red. A brief synopsis will follow.

“Research combining structural MRI (sMRI) and cerebrospinal fluid (CSF) examination has revealed that cognitively normal older adults with abnormal amyloid beta and tau pathology in CSF biomarkers exhibit a reduction in gray matter (GM) volume within the Ch4 subregion of the BF. A longitudinal sMRI study found that in cognitively normal participants destined to develop AD, the BF area exhibited significant atrophy as early as 4.5 years before the onset of clinical symptoms, indicating that atrophy in the BF is a biomarker that predicts the likelihood of asymptomatic elderly subjects developing AD.”

“It has been reported that approximately two–thirds of patients with AD are females, and they tend to experience faster cognitive decline compared to males. This could be due to the brain of female patients with AD undergo more severe pathological damage, leading to more pronounced hippocampal atrophy and cognitive decline. Extensive brain imaging studies have provided evidence that males with MCI and AD tend to experience slower rates of brain atrophy over time compared to females. In addition, it has been observed that males with MCI show less atrophy in multiple brain regions, and once diagnosed with AD, they exhibit less atrophy in various regions as well. It has been proposed that cholinergic basal forebrain cortical projection neurons within the nucleus basalis, which mediate memory, attention, and the degeneration in AD, may exhibit greater vulnerability in elderly females compared to males.”

“Animal experiments have further revealed significant sex differences in estrogen receptors within BF cholinergic neurons.”

“Our findings indicated a significant reduction in BF volume, specifically in the Ch4 region, even before the diagnosis of AD. Most of the cholinergic innervation of the cortex, which is involved in attention and memory, originates in the Ch4 (nucleus basalis of Meynert) and in the horizontal limb of the diagonal band nucleus of the basal prosencephalon. Functional alterations in this system have been implicated in neurocognitive disorders as well as the cognitive changes described in Parkinson’s disease and AD. The atrophy of BF in patients with AD and MCI has been widely reported. A study utilizing a large multicenter dataset found that all of the subregion volumes of the BFCS were significantly reduced in the AD group.”

“The survival and maintenance of BFCS neurons rely on the nerve growth factor (NGF) and its homologous receptors (trkA and p75[NTR]). Compared to HC, p75(NTR) mRNA levels in BF cholinergic neurons decreased by approximately 40% in females with AD, while the p75(NTR) expression in males remained unchanged. Additionally, compared to HC and MCI individuals, males with AD demonstrated a 45% decrease in trkA mRNA levels in BF cholinergic neurons, while females exhibited a 50% decrease, and reduced trkA mRNA levels were associated with poorer global cognitive performance in females. These findings suggested that females may be at a higher risk of cholinergic BF neuron degeneration.”

"An animal experiment showed that estrogen had a protective effect on both male and female BF cholinergic fibers, and the therapeutic potential of estrogen decreased with increasing age."

Gender-dependent Effect Conclusion: There is a complex relationship between estrogen, SIGMAR1 expression, APOE, cholinergic atrophy, and neurodegeneration. So far, monoclonal antibodies have showed reduced efficacy in female patients. Considering Blarcamesine's wide-sweeping MOA and the relationship between estrogen and SIGMAR1 reduction in female patients, we expect the drug to be more efficacious in females than the MABs by boosting endogenous protection and restoration. Multiple studies have now demonstrated that SIGMAR1 confers/interacts with p75 noted in one of the excerpts above, further lending credence to SIGMAR1/estrogen axis of effect. Nonetheless, due to more pronounced BFCS degeneration innate to female patients, it is not likely female and male patients with see an equal response. Perhaps more than anything, we find the sex-dependent effect of Blarcamesine's therapy to be forefront of interest. More information can be found in the "gender and estrogen" portion of the SOTC AAIC 2023 readout here.

SIGMAR1 (S1R) mRNA Levels

A driver of clinical success is attributing drug MOA to clinical efficacy. For the MABs for instance, the goal is to show reduction of amyloid and correlate those results to improvements in CDR-SB (or slowing effect). In the Alzheimer's 2a trial, PDD trial, and Rett suite, increased SIGMAR1 mRNA corresponds to higher clinical output. While a minor note, we expect this trend to continue in the 2b/3 final analysis. This ties in nicely with the next section below.

Odds Ratio + Effect Size:

According to Anavex's 4 Nov 2017 PR, of the 30 patients that completed the primary phase 2a Alzheimer's study to 57 weeks, a strong drug concentration / response relationship was first identified. Drug concentration in the upper tertile (1/3) increased the probability of improved MMSE score 2.1 fold (110%) and ADCS-ADL score 1.6 fold (67%). It was stated in the 25 Jul 2018 PR that 80% of patients were "responders" resulting in improved MMSE and ADCS-ADL.

As shown in the 2a supplementary materials, higher drug dose nearly always (although not exclusively) correlated to higher drug concentration. For these intents and purposes, high dose = high concentration. 

Pulled directly from Anavex's 1 Dec 2022 PR: "ANAVEX®2-73 demonstrated visible improvement in patients with Alzheimer’s disease. Patients treated with ANAVEX®2-73 were 84% more likely, to have improved cognition by ADAS-Cog score change of -0.50 points or better from baseline to end of treatment than patients on placebo, Odds Ratio = 1.84 (p = 0.015). On average, patients, who improved cognitively with ANAVEX®2-73 treatment, improved by ADAS-Cog cognition score of -4.03 points. ANAVEX®2-73 treatment was 167% more likely to improve function compared with placebo, at a clinically meaningful improvement of ADCS-ADL score change of +3.5 points or better, Odds Ratio = 2.67 (p=0.0255). This reflects a robust improved and clinically meaningful outcome in cognition and function from baseline."

As was found in the 2a trial, it is highly likely that the higher dose/concentration group had better scores in both memory (ADAS-COG) and function (ADCS-ADL). 

According to the CTAD 2022 presentation given by Dr. Macfarlane, 287 dosed patients (85.7%) were titrated to 30mg or 50mg. Of those patients, 263 (78.5) did not need to down-titrate from their set 30mg or 50mg dose. The presentation did not breakout the 30mg and 50mg separately; however, we assess it is likely more 50mg patients down-titrated over the 30mg cohort due to higher odds of increased dizziness/headache. It's very difficult to project a meaningful outcome without the exact numbers, but we hypothesize somewhere between 110-120 patients on the 50mg dose maintained the objective dose until end of study. Based on my previous analysis considering patient severity, dose, APOE genes, and S1R WT, there is possibly up to 98 "responders" [+/- 10%] as defined by Anavex's own description (ADAS-COG of -.5 points or better and/or ADCS-ADL +3.5 points of better). Most of these responders would be from the 50mg group with a much lower percentage from the 30mg group. 

Odds Ratio + Effect Size Conclusion: While the pooled data presented so far is positive and met necessary statistical weight for success, the real anticipation comes with broken out subgroups - especially the 30mg vs. 50mg subgroup. As it stands, it is possible to equate an effect size to the pooled odds ratios, as they can be a little bit difficult to understand on their own.

• ADAS-COG ODDS RATIO: 1.84 = a small+ effect size

• ADCS-ADL ODDS RATIO: 2.67 = a medium+ effect size

Keep in mind that Anavex's responder threshold was improvement over baseline, which is unique to Anavex, with predecessor competitors always opting for 'slower decline' as their responder threshold. With this knowledge, the odds ratio and respective effect sizes are more impressive than what meets the eye. A 50mg only analysis would also certainly garner higher odds ratios and effect sizes. 

Time Saved and Placebo Improvement [Donanemab]:

In MCI and early-Alzheimer's stage patients, placebo improvement is a common phenomenon. In the Donanemab trial, the following was noted:

• Low/Medium Tau Group [ideal patients]: 47% of dosed patients saw no progression on CDR-SB, 29% of placebo patients saw no progression

• Pooled Groups [all dosed vs. placebo]: 36% of dosed patients saw no progression on CDR-SB, 23% of placebo patients saw no progression

We do not currently have data on placebo response in Anavex's 2b/3 Alzheimer's trial, but there was surely placebo response as patients are susceptible to placebo effect and earlier-stage patients can still see benefit from diet, exercise, and lifestyle improvements. CDR-SB is scored on a 0.5-point scale, so it's not the best tool to use for progression analysis, but there is no ADAS-COG or ADCS-ADL progression analysis publicly available for progression. In addition to the progression metric, time-saved will be another key output we hope to be included in the final data set. Time-saved was all-the-rage at AAIC 2023, and according to analysis presented there featuring unique calculation methods the following was elucidated:

• Donanemab: saved 5.5 months in 18 mo dosing cycle

• Lecanemab: saved 5.1 months in the same

• Aducanumab: saved 2.6 months in the same

Time Saved and Placebo Improvement [Donanemab] Conclusion: There is still a lot of useful data expected from the 2b/3 trial. At AAIC 2023, Dr. Jeffrey Cummings mentioned how time-saved may be the most useful metric for approval going forward, and that odds ratio analysis will be instrumental in determining which patients are right for each drug. SOTC previously attempted a time-saved analysis using brain atrophy, that analysis can be found in graphic 5, here. We thought it necessary to share Donanemab's placebo response in order to set expectation for the final Anavex data release and put forth the understanding that placebo response, while robust, can be overcame with drug efficacy - even when threshold for efficacy was set as high as Anavex's.

Bottom-line Up Front (BLUF): Two years ago on 6 Feb 22, ForestFoxes asked me a question related to doubts of another poster to Blarcamesine's long-term efficacy. The other poster stated "....the gist of it was that it [S1R agonist] will work and do so quite dramatically-at the beginning, but over time it will become less effective as the person's S1R levels continue to drop (or the patient will require increasing doses with declining improvement over multiple years) and it's therefore not going to prove a viable long-term therapeutic strategy..."

Yesterday, 6 Feb 24, ForestFoxes requested an update to my initial repsonse. Below you will find my response two years ago, as well as my response yesterday. At the least, I believe some followers will find the conversation interesting.

Reply on 6 Feb 22:

First, I don’t believe his point to have merit. The AD 2a trial extended through 5 years with at least half of the patients still taking the drug. (These people were quite old, it is likely that some actually died - not Blarcamesine related).

Secondly, I found in my analysis that most AD drugs dropped efficacy dramatically somewhere around the 35-45 week range (need to go back and find the exact number). Anavex did not see a drop here, in fact, it increased further. With this being the case, Anavex already beats SOC in multiple arenas. 

Of course many drugs lose efficacy after bodies attenuate to the response. But we haven’t seen meaningful evidence towards this at the 5 year mark. And what’s more, it is my hypothesis that the preventative CNS trial Anavex is planning will begin patients at 30mg. If people take 30mg to stave off CNS disorders but begin losing efficacy, the dose can be titrated up to 50 (and in some cases 60mg) to account for that loss.

Reiteration on 6 Feb 24:

Indeed, based on slope change for ADAS-COG and CDR-SB in the 2b/3 trial, Blarcamesine efficacy appears to increase with time, especially the longer the trial went on (week 36-48). 

I was going through the 2a supplementary material the other day and found some interesting tidbits. Primarily, it was found that TIME on drug was the lead indicator of therapeutic value in both cognition, and activities of daily living. 

This was especially true in patients with APOE4 genes (the majority of AD patients). Patients with high blood concentrations of the drug found the most therapeutic benefit. While not exclusively high dose patients, MOST high concentration was found in high dose cohort. High concentration and time on drug were especially important for patients with S1R variant. 

Lastly, COMT gene variant also needed more time, which correlated to higher activities of daily living scores but not necessarily cognition.

As we know, the most ideal patient type for blarcamesine are patients with S1R WT, early in disease stage, with APOE3 genes and high drug concentration. These patients, ESPECIALLY over a long trial period, will do very well in the trial and represent most likely ‘responders’ or ‘super responders’. I have done analysis prior to determine the odds of being one of these such patients. It was 48% of all MCI and early stage Alzheimer’s patients. When combining the ‘second best’ patient group, blarcamesine can optimally treat 61% of ALL MCI and early AD patients. Which is significant. Nearly all other patients (remaining 39%) respond well to treatment, but simply slow degradation instead of halt/improve.

One of my key takeaways is that ADCS-ADL may not have seen enough separation from placebo during the trial. Which isn’t necessarily surprising as activities of daily living are hardly affected in very early stages. More so than cognition, it was found in the 2a supplementary data that ADCS-ADL was improved most by patients on the trial longest. This makes sense, as cognition and brain degradation are the two drivers of reduced patient function. By improving brain function and halting atrophy (or slowing in both cases) activity scores would have a trailing effect that would take longer to record. 

I’m looking forward to 72-week OLE data, as this is congruent with both Lecanemab and Donanemab trials, and is likely more than enough time to garner ADCS-ADL separation.

I’m also looking forward to a 50mg-only chart, a “responder-only” chart, and oppositely, a total non-responder chart of the worst performing patients to better define what small percentage of patients respond worst to the therapy. Perhaps it is a specific co-morbidity, pathology, or gene keeping those patients behind. 

We have still only seen pooled data for the trial, with responder analysis in “odds ratio” and mean change data for ADAS-COG and CDR-SB. And only for a short 48 weeks. I emphasize “pooled” because in theory, most patients could likely titrate up to 35-45mg. This is why I’m most interested in high dose or high concentration-only charts. Even if the drugs quadruple muscarinic modulation causes transient dizziness or headaches, I believe it is a risk most patients would take if foretold that the drug would provide MEANINGFUL benefit. We already have evidence of this as the vast majority of patients continued to OLE and continued even further to the extended-OLE.

Phase 2 Trial for Anavex 3-71 in Schizophrenia is Imminent 

Bottom-line Up Front (BLUF): On 7 Feb, the trial design for Anavex's 3-71 Schizophrenia trial became available on clinicaltrials.gov. The trial is set to assess approximately 40 patients over 10 or 28 days with two doses (30mg & 60mg), in the United States. The trial features a vast array of endpoints (38) and is supported by the COGNISION consortium, the Cognitive Research Corporation, and Hassman Research Institute. While the trial is exploratory in nature, the inclusion of fluid biomarkers is exciting, and positive outcome there would propel the indication through to a well-deigned phase 2b/3 or phase 3.

Trial Design Notes: 

After analyzing other phase 2 Schizophrenia trials, we found that both the size and length of Anavex's trial to be within established norms (15-125 patients, 2-6 weeks). Looking at the trial endpoints, we most look forward to the PANSS, BACS, CGI-SCH, and biomarkers YKL-40, GFAP, amino metabolites, and of course the Anavex-standard DNA/RNA & whole genome analysis. The biomarkers and genome analysis will objectively correlate PANSS, BACS, and CGI-SCH efficacy to molecular improvement via gene up-regulation. 

Anavex 3-71: 

Having explained differences between Blarcamesine and Anavex 3-71 in the past, below is a brief refresher on why Anavex 3-71 was chosen over Blarcamesine for Schizophrenia. 

• Pros for 3-71:

  • • Massively increase S1R and M1 agonism. Of all the muscarinic receptors, M1 is known to be highly concentrated in the CNS with ties to motor, learning, and memory.

    • Eliminating M3-M4 reduces safety concerns as quadruple modulation of muscarinic receptors has historically been tied to dizziness, headaches, and in some rare cases psychiatric problems.

    • Access to a slew of 5-HT serotonin secondary receptors for psychiatric benefit.

    • Retains good M2 agonism for motor function.

• Con Differentiators from Blarcamesine: 

  • • Lacks SCN2A which is probably the biggest component for autism & seizures.

    • Lacks M3 agonism which is probably one of two greatest factors influencing blood pressure/endothelial aid.

    • Lacks NMDAR, probably the second biggest component for autism.

Overall, as mentioned in previous publications, Blarcamesine is an excellent 'whole body' therapy and has special considerations for autism disorders and epilepsy. Meanwhile, Anavex 3-71 is an ultra-focused cognitive enhancer and psychiatric aid, making it more ideal for Schizophrenia.