Tonix Provides Updates For Fibromyalgia, And Other News: The Good, Bad And Ugly Of Biopharma

Tonix Pharmaceuticals provides updates for fibromyalgia and COVID-19 studies

Tonix Pharmaceuticals Holding Corp. (TNXP) announced the enrolment of first participant for its PRECISION study. The trial is being conducted to facilitate development of Precision Medicine Techniques for developing COVID-19 vaccines and therapeutics. The company also provided updates regarding the completion of its Phase 3 RELIEF study for TNC-102 SL for treating fibromyalgia.

PRECISION study is an observation trial for evaluating the immune response in healthy patients who have either recovered from COVID-19 or were asymptomatic. Seth Lederman of Tonix said, “This work may also guide the selection of appropriate participants for clinical trials of COVID-19 vaccines, including future human trials using Tonix’s TNX-1800, a live replicating, attenuated COVID-19 vaccine candidate designed to confer durable T cell immunity.” TNX-1800 is a live modified horsepox virus vaccine and works by expressing the Spike protein of the SARS-CoV-2 virus.

Tonix Pharmaceuticals also recently concluded its fibromyalgia study of TNX-102 SL. The unblinded interim analysis was conducted by an independent statistical team. The analysis was carried out on the first 50 percent of randomized participants who entered the 14-week study. On the basis of interim results, the independent data monitoring committee recommended the trial to be continued and to be further augmented by 210 participants on top of the original 470 patients. The company now plans to conclude the study by analyzing 503 currently enrolled participants.

Tonic expects the top line data to be out in the fourth quarter of this year. The company will stay blinded to the interim analysis results. Seth Lederman, CEO of Tonix, said, “Based on the prior Phase 2 and Phase 3 studies in fibromyalgia at a lower dose, we believe that TNX-102 SL has potential as a novel non-opioid, centrally-acting analgesic for the millions of U.S. adults suffering with fibromyalgia.” The company is currently recruiting for a new potentially pivotal Phase 3 trial for studying TNX-102 SL for managing fibromyalgia. The top line data from the study will likely be out during the second half of 2021.

The RELIEF and RALLY studies are double-blind, randomized, placebo-controlled trials. Each one targeted 470 patients, and the participants were administered TNX-102 SL 2.8 mg (1 tablet) or placebo in the run-in period during the first two weeks of treatment. The primary endpoint of the study was related to the change in daily diary pain severity score from baseline. The data was analyzed using mixed model repeated measures with multiple imputation.

Analysis: Tonix is another player on the COVID-19 landscape, repurposing a horsepox vaccine. The other Tonix candidate in the news targets fibromyalgia, which had a market of ~$2.8 billion in 2018, estimated to grow Y-o-Y at a CAGR of 3.3%. The 16-employee company lost over 80% of its market capitalization in the TTM to be at ~$87 million, currently trading at $0.64, near its 52-week low, from a high of $4.10 a year back. One Wall Street analyst is very bullish with a price target of $3. Over 96% shares are held by the public, while insiders hold only 0.11% shares. Institutions hold ~3.5% shares. The company has a cash balance of ~$55 million, about half a million debt, and a cash burn of about $38 million in the TTM.

Investment Thesis: With highly diverse product candidates, ranging from fibromyalgia to COVID-19, the company has strong catalysts ahead. However, the stock has not been able to come close to its highs and has a high risk profile.

Innate Pharma proceeds with monalizumab trial, triggering milestone payment

Innate Pharma SA (IPHA) announced dosing the first patients of its Phase 3 clinical trial, INTERLINK-1. The study is designed to assess monalizumab in combination with cetuximab in patients with recurrent or metastatic squamous cell carcinoma of the head and neck (R/M SCCHN). The drug candidate has the potential to become the first-of-its-kind immune checkpoint inhibitor targeting NKG2A receptors expressed on tumor infiltrating cytotoxic CD8+ T cells and NK cells.

Innate is collaborating with AstraZeneca (AZN) for developing this program. The dosing of the first patient has triggered a milestone payment of $50 million due to Innate from AstraZeneca. Mondher Mahjoubi, CEO of Innate Pharma, said, “The steady and rapid progress of this program is a testament to our strong collaboration with AstraZeneca, and we are hopeful that together we will bring a novel treatment option to this patient population with high unmet medical need.” The company expects the new cash infusion to bolster its liquidity through the end of 2022.

The data showed the combination of monalizumab with cetuximab to have a manageable safety profile. The combination also demonstrated a response rate of 27.5 percent. Based on the results derived from Phase 1b/2 study, the companies decide to promote the program directly to Phase 3 stage.

INTERLINK-1 is a global, multi-center, randomized, double-blind Phase 3 study. The primary endpoint of the study is overall survival, while the secondary endpoints include ORR, progression-free survival, quality of life and duration of response.

Analysis: Innate Pharma's monalizumab is riding on an aggregate $1.275 billion plus tiered low-double digit to mid-teens royalty deal with AstraZeneca. Three Wall Street analysts are very bullish and one is bullish on the stock, scoring an average 4.75/5 and a price target of $10.88. The current stock price is $4, near its 52-week low in a range of $3.3-8.24. The price dipped after 1H results were announced in September 2020. The company has a market capitalization of $317.5 million, cash balance of $166.02 million, and a debt of $21.14 million. Innate reported ~$96 million revenue in 2019, and estimates for 2020 and 2021 are ~$105 million and ~$79 million respectively. The company had cash burn of $38.8 million and revenue cost of $82.9 million in the TTM. It expects a cash runway through 2022.

Investment Thesis: The stock is trading at deep discount, and the latest cash infusion will help the company stay afloat. The stock offers good potential in the long run.

Ultragenyx inks deal with Solid Biosciences for Duchenne Muscular Dystrophy program

Ultragenyx Pharmaceutical Inc. (RARE) announced striking a new deal with Solid Biosciences Inc. (SLDB) pertaining to the Duchenne Muscular Dystrophy program. The companies will work together to develop and commercialize meaningful therapies for the condition. The collaboration will seek to leverage Solid’s differentiated microdystrophin construct and Ultragenyx’s HeLa producer cell line manufacturing platform.

The terms of the agreement provide an exclusive license to Ultragenyx for products arising out of the development program, subject to certain conditions. Ultragenyx has pumped $40 million into Solid Biosciences. Emil D. Kakkis of Ultragenyx said, “By using an AAV8 variant validated in prior human and other studies combined with our scalable, efficient HeLa producer cell line platform, we believe we can leverage our mutual strengths to develop a high-quality AAV-based treatment alternative for Duchenne.”

Ultragenyx has also agreed to pay up to $255 million in various milestone payments to Solid upon the achievement of set goals. Solid Biosciences will also the right to choose to co-fund collaboration programs and receive part of the profits or enhanced royalty payments in return.

Solid’s proprietary microdystrophin construct has shown functional benefit in preclinical models. Ultragenyx will use its AAV-based HeLa PCL platform for the development purpose. This platform will allow large-scale product manufacturing.

Ultragenyx is a biopharmaceutical company and mainly focuses on rare genetic diseases. It has a highly diversified product portfolio and robust development pipeline in different stages. The company currently has three AAV gene therapies in clinical development phase.

Analysis: Ultragenyx deal with Solid Biosciences represents an outgo of about $300 million plus probable royalties on a DMD program that targets a market estimated to reach $4.11 billion by 2023. The company has a market capitalization of $5.64 billion, at a stock price of $91.25, near its 52-week high. Major shareholders are 95% institutional and 5% insiders. Ultragenyx has a cash balance of $813.42 million and debt of $43.57 million. Cash burn was $172.7 million and revenue cost was $383 million in the TTM. The company had a revenue of $103.71 million in fiscal 2019, and revenue estimates for 2020 and 2021 are $210.56 million and $330.53 million respectively.

Investment Thesis: The stock has more than doubled in the past one year. However, with robust development assets and increasingly positive operational performance, the stock has further upside left to it.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.