For months on end, Neuralstem (CUR) has been pounding the table for the FDA to give the go-ahead for its phase II ALS trial. Ever since the company's final phase I patient, now world famous Ted Harada, got his injections of Neuralstem stem cells in 2011 to become the first person ever to have his ALS condition dramatically improve, the entire ALS community has been waiting with baited breath for phase II to begin.
This month, Neuralstem finally got the green light and has already filed the protocol for its phase II ALS stem cell trial. What was the hold up? The FDA was demanding a slower time frame than Neuralstem wanted for the dosing of patients as a safety precaution. In other words, for safety reasons, the FDA preferred to let ALS patients, with an average mortality rate of 2-5 years after diagnosis, wait. Just to be safe. And then, as chief investigator Dr. Jonathan Glass described, Neuralstem would ask the FDA questions, maybe like, "Why should we make ALS patients wait?" and then wait the statutory 30 days for every response.
What finally shook them loose? It seems to have been a public meeting that took place on February 25th at the FDA campus in Silver Spring, Maryland. The FDA met with the ALS community including Neuralstem and other companies, while speakers, including Ted Harada himself, got up and basically screamed and begged, respectfully. You can peruse the entire 313-page transcript of the meeting here. Reading it myself, I could feel the tension and pain in the air, and the wrenching tightrope laymen speakers had to walk between respect and fear of the FDA and their urge to just come out swinging.
One speaker, Kathleen Thompson, told the story of her 32 year old son Thomas who had to wait and wait for a clinical trial that never got FDA approval, and is now what Kathleen calls a "throwaway" patient, in that he is no longer eligible for trials as his ALS has progressed too far. She uses the word "respectfully" in her speech many times, but you can feel the knot in her and your throat as you read. Another speaker, ALS patient Tony Gregor, was less refined, concluding his speech with the line, "Get off your asses and find something."
Though I can't prove it, I suspect that these speeches were the decisive factor in getting the FDA up and moving and Neuralstem's phase II up and running.
Phase I vs Phase II comparison
There are quite a few reasons to be excited about this upcoming trial. There are several key differences in the set up between the two, with reason to believe that the phase II will be completed faster than the phase I was, which took 4 years.
To begin with, one of the more overlooked but critically important factors is the number of study locations. Phase I had a single location at Emory University in Atlanta, and with only an estimated 20,000 ALS sufferers in the entire country, it is not easy to find 15 of them who will qualify all in one city. Just doing the math, the population of Atlanta carries .14% of the US population, which translates to 27 ALS patients in the whole city. Include surrounding cities and the numbers still are not favorable, which is one reason that it took so long to recruit.
Phase II will be opened in two locations, once again at Emory as well as the University of Michigan at Ann Arbor and will enroll 18, 3 more than the phase I did. Combine Ann Arbor with Detroit, a 45 minute drive, and add in Atlanta, and we're at .4% of the US population, which translates to about 80 ALS patients in the area. Much more favorable numbers here. Enrollment will be quicker. There will be 5 groups of patients with a 4-week waiting period between each group, giving a minimum enrollment time of 20 weeks, though it will in all likelihood be longer.
The second reason for optimism is that the phase II is only including patients who are ambulatory and who therefore presumably have a chance to have their symptoms reversed like Ted Harada. By contrast, phase I included 6 patients out of 15 who were confined to a wheelchair and/or on a ventilator. This will give a bigger sampling of patients who can demonstrate real efficacy rather than just safety. Phase I had one major success out of 9 patients. If phase II can show the world two more Ted Haradas, Neuralstem's phase III could end up being an international spectacle.
The third reason is on the financial side, and that is that Neuralstem's phase II costs are covered by the NIH, so its finances will remain stable throughout, barring any unforeseen expenses. The NIH being a government agency, profits from any eventual approval do not have to be split with them. The company also just landed an $8M credit line (page 9) which will comfortably fund it through 2014, with total cash reserves of around $15M. The NIH funding also has implications for any future phase III. The NIH probably would not have offered to fund phase II if not for the phase I success. If phase II is successful as well, somebody is going to want to fund phase III, and if it's corporate, CUR shares will react, though on the downside, Neuralstem would have to share profits.
The $8M loan is Neuralstem's first venture into taking on any sizeable long term debt. So far, its balance sheet has been completely debt free. For a company that has already hit a single with Ted Harada and rounding 2nd with its phase II, now is as good a time as any to capitalize, and thankfully for shareholders, to do so without diluting, though there is still a danger of that happening later on down the road.
To close with another (perhaps a bit corny) ALS baseball reference, hopefully, after the conclusion of phase II estimated at less than a year from now in April 2014, those phase II Neuralstem patients...can consider themselves...the luckiest people...on the face of the Earth.