Back in October, when I first encountered Neuralstem (NYSEMKT:CUR), the stock was trading below all its moving averages at about $0.90 a share. Since then, the technical condition for the stock has improved. On the back of the company's third quarter earnings report and the completion of its FDA Phase I trial for Lou Gehrig's Disease (ALS), the shares spiked higher to $1.50 before eventually settling back to trade in a range between roughly $1.10 and $1.30.
It looks like the stock could now be gearing up for another significant move as it moves toward Phase II clinicals for ALS while continuing to develop the licensing network of its patented spinal cord drug delivery platform.
Just last week the company signed another big name licensing deal with Cedars-Sinai Medical Center in Los Angeles. The agreement gives Cedars-Sinai rights to use Neuralstem's platform and floating cannula in its own research into spinal cord injuries and chronic diseases.
Successful completion of the company's Phase I clinicals for ALS certainly played a part in the prestigious LA hospital and research center's decision to sign on.
Just What Kind of Results Were Achieved?
ALS is a disease with no known cure that affects the neuromuscular system, progressively robbing the afflicted of their ability to use their muscles altogether. From onset, the disease proceeds rapidly and without remission until patients are no longer able to breathe on their own and medical options cease altogether.
Neuralstem's treatment for ALS, NSI-566, got widespread media coverage just as the company's Phase I trials were concluding, when at least two patients began showing signs of stabilization. The results shocked the medical community. Research published by Stem Cell showed that three separate ALS testing regimens scored one patient maintaining strength after stem cell implants and a second patient emerging stronger than he had been before the NSI-566 was administered.
The latter was the case that captured the medical community's imagination, and remains the one for which they're still searching for answers.
It's the story of Ted Harada, an Atlanta man who saw rapid and ongoing improvement in his condition, not once but twice, after separate treatments with NSI-566 over the last year.
Harada's plight began two years ago, when he was diagnosed with Lou Gehrig's Disease and began a very rapid degeneration, to the point where he could no longer walk without a cane. After Neuralstem's treatment, however, not only did Harada return to walking without support, but he completed a widely publicized 2.5 mile walk for ALS in Atlanta, finishing with a show of strength that surprised even his family.
Doctors Are Shocked
What's most promising about Harada's case is his progress came about as result of a Phase I trial, initiated exclusively to determine the safety of the drug. Upcoming Phase IIs will test to determine maximum dosages and evaluate for efficacy, and only then will researchers (and large biomed corporations) know whether there's a genuine commercial product that can be marketed here.
It was precisely because such tremendous improvement was seen at this early stage in the process that scientists are dumbfounded. Emory University neurologist, Dr. Jonathan Glass, a collaborator in the clinicals said, "Now, this is a disease that doesn't get better. So we don't see patients who spontaneously get better. It just doesn't happen."
Final results for the Phase I trials will be available in March, at which point we'll know more about Mr. Harada and two other patients who received both lumbar and cervical cord injections. According to some, it's the cervical injections that could prove pivotal in assisting with breathing and swallowing function - for it's ultimately respiratory failure that causes most ALS deaths.
Phase II studies are slated to proceed later this year, after full funding has been secured. Emory University, which led the first phase trials along with the University of Michigan Medical School, has already managed to secure a large NIH grant to that end.
Background Check: Who Is Neuralstem?
Neuralstem's core business essentially resides in a patented technology that permits it to produce neural stem cells from the brain and spinal cord in commercial quantities. Those cells are administered to various parts of the spine and neck of those who suffer from diseases like ALS, Huntington's, ischemic stroke and glioblastoma (brain cancer) with the goal of integrating with existing tissue and either repairing or creating new 'neural circuitry' altogether.
With the success of its ALS Phase I trials virtually in hand, Neuralstem was recently awarded FDA approval to proceed with Phase I clinicals on NIS-566 for patients with chronic spinal cord injury (cSCI) who have an American Spinal Injury Association 'A' level of impairment and are now between one and two years after their initial injury. An 'A' level of impairment refers to those with "no motor or sensory function in the relevant segments at and below the point of injury, and is considered to be complete paralysis."
On a separate front, Neuralstem is advancing trials on NSI-189, the first of the company's four neurogenic small molecule compounds, for the treatment of major depressive disorder. They're now in the midst of an FDA-approved Phase Ib safety trial, and company spokespeople say the treatment could also prove useful for patients with Alzheimer's disease, post-traumatic stress disorder (PTSD) and chronic traumatic encephalopathy ((NASDAQ:CTE)).
Widespread Affliction Amongst Athletes and Soldiers
CTE is a condition that has been lesser known until recently, when a number of widely publicized suicides among NFL and NHL players, both former and active, drew attention to the condition. CTE is caused by repeated blows to the head that lead eventually to a shrinking of the hippocampus and a concurrent loss of memory and cognitive function, and in many cases, the onset of depression. The condition has also stricken numerous boxers, professional and amateur, as well as a great many servicemen returning from Iraq and Afghanistan.
To close, I believe that Neuralstem's strengths will ultimately lead to full-on commercialization of several of its treatments. This is not a 'science project'. The company 's fourteen year research history simply cannot be replicated by competitors, nor ignored forever by Wall Street. It has a 'product' that is producible in commercial quantities, and now, finally, a slow but steady advance toward legal approval of its various treatments.
Neuralstem remains a buy.
Disclosure: I 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.