In an earlier article on Novabay (NYSEMKT:NBY) I discussed the science behind NCV-422 and its potential as a treatment for impetigo. In this article, I want to focus on adenoviral conjunctivitis (pink eye caused by a virus) as the company expects to report data in the fourth quarter of 2013 from their Baynovation phase II trial. In addition, the company targets the start of Baynovation II phase III trial for the end of the year (see slide 19). Currently there are not many treatment options for viral conjunctivitis outside of supportive care (also see here). Novabay estimates (slide 12) the total market opportunity for viral conjunctivitis is about $700 million ($300 million of that in the United States). There is also a $1.2 billion opportunity for bacterial conjunctivitis, which makes the global conjunctivitis market close to $2 billion. The best case scenario for Novabay would be success in both viral and bacterial conjunctivitis as it would be the only curative treatment for both types. So what is the evidence that NCV-422 could work against both manifestations of the disease?
Preclinical models have shown that NCV-422 has activity against both viral and bacterial conjunctivitis but I want to focus on the anti-viral activity. Yoon et al (2011) elucidates both the mechanism of action against viral conjunctivitis but also describes the anti-viral potency. In particular, NCV-422 attacks the virus through "the rapid oxidation of sulfur-containing amino acids in key viral capsid proteins, resulting in the loss of viral structural integrity and infectivity" (Yoon et al 2011: 471). In addition, it was found that NCV-422 worked by killing the virus while it was outside of the cell and did not affect the replication of viruses once they were in cells. The degree of NCV-422 virucidal activity was tested against adenovirus type 5 (Ad5), where the combined adenoviral protection assay (CAVPA) showed an IC50 of 9.2 mM. To put that into perspective, cidofovir (used as a treatment for CMV reinitis) had an IC50 of 29 mM. Jekle et al (2013) further tested the virucidal activity of NCV-422 across a number of common ocular viruses (Ad5, Ad8, Ad19, Ad37, HSV-1, Coxsackievirus A24, and Enterovirus 70) and found it effective against all with log reduction of virus at 1 hour that ranged from 6.3 to 0.88.
When delivered to viruses in the proper concentrations, NCV-422 can clearly kill. The next question is whether the compound is stable enough to get to the viruses, especially given that its effectiveness is correlated with acidity. Jekle et al (2013) found, for instance, that the IC50 against the Ad5 virus at 60 minutes of exposure was 0.99 when the ph level was 4 (about the acidity of tomato juice). When the ph was increased to 7 (neutral, i.e. distilled water) the IC50 at 60 minutes increased to 15.78. Given that the ph of human tears ranges from 6.5 to 7.6, it is critical to understand how NCV-422 would behave in such an environment. While the increased ph in tears affects the IC50, Jekle et al (2013: 1249) tested the compound in a number of concentrations of synthetic tears and found that "NVC-422 retains its HAdV-5 virucidal activity in the presence of different concentrations of synthetic tears." So how did NCV-422 perform in human trials?
The phase IIa study in viral conjunctivitis did not meet its primary endpoint of sustained microbiological success of 20% greater than placebo. The trial did find, however, that the patients infected with epidemic keratoconjunctivitis (EKC) responded quite well to the treatment. While you always have to worry about trials that fail in the predetermined population but succeed in a non-predetermined sub-set, it is not necessarily surprising that it worked best in this group. EKC is commonly associated with adenovirus serotypes 8, 19 and 37 and Jekle et al (2013) found that those are three of the virus types in which NVC-422 was most effective in a preclinical setting. In terms of sustained clinical cure (primary endpoint of current phase IIb study) Novabay noted that in the "for the 29 evaluable patients, the clinical cure rate increased throughout the 18 days to 69% (11/16) for the active group and 54% (7/13) for the placebo group, a difference of 15%. The cure rate of the active group for the EKC patients was always greater than the placebo treatment group and ranged from approximately 7% to 15%, starting at Day 3.The most common adverse event was eye irritation (14.2% NVC-422, 1.3% placebo) but that would be expected given the acidity needed to keep NVC-422 effective.
So what does all of this mean for the Baynovation phase II trial? First, I think the pre-clinical work and early trial results indicate that NVC-422 is most effective against adenoviruses. Second, the phase IIa trial did not enrich the sample for adenovirus patients but in the Baynovation trial they seem to be only including those with adenovirus conjunctivitis. As such, the newer trial has a patient population designed to maximize the chances of success. Of course, nothing is a sure bet and the biggest risk to success is the acidity (or lack thereof) of the eye and how this would affect the anti-viral activity of NVC-422. In addition, while the efficacy in the phase IIa trial was always higher than placebo, it still did not surpass the 20% improvement over placebo that was the goal in the phase IIa trial. Ultimately, however, this is a difficult disease to treat but Novabay has a trial that provides NCV-422 its best chance of succeeding.
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.