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Johnson & Johnson's (NYSE:JNJ) experimental antidepressant esketamine, derived from a popular party drug, showed fast response in a trial of patients whose depression had not responded to at least two antidepressants.

Current treatments for depression, including drugs like Prozac and Celexa, often take a month or more to give patients relief, and they don't work for everyone. At least a third of people with depression get no relief from current treatments.

The hunt is on for a faster-acting, more effective antidepressant.

Esketamine

Johnson & Johnson's version of the party drug and anesthetic ketamine is a modified intranasal spray version, and it is called esketamine.

Johnson & Johnson disclosed development of the ketamine nasal spray for the treatment of depression during a meeting with analysts on May 23, 2013. The product is not listed among the company's pipeline drugs in a document updated as of April 16, 2013 on the J&J website.

Ketamine is an approved drug as an anesthetic. Esketamine is an isomer of ketamine that would allow for a dose only one twelfth as much as the dose normally used for anesthesia.

A Phase 1 clinical trial of intranasal esketamine sponsored by Janssen, a J&J subsidiary, is underway with 58 participants in Belgium. Patients are divided into 3 groups and the nasal spray is tested in different doses and time periods.

Safety evaluations will include assessment of adverse events, targeted nasal examinations, laboratory tests, electrocardiogram, physical examination, pulse oximetery, and vital signs.

At this point it is not yet clear whether esketamine will be used only to get people out of a depressed and potentially suicidal state, or whether it could become a chronic treatment, given at the doctor's office on a regular basis.

Esketamine has received a fast track status from the FDA.

Discovery

Husseini Manji, Johnson & Johnson's head of neuroscience research was previously employed at the National Institutes of Health, leading a mood and anxiety disorders program.

The program has led to one of the greatest breakthroughs in psychiatry in recent years: the finding that a brain receptor called N-methyl- D-aspartate (NMDA) plays a key role in depression. It was also found that when ketamine hits that receptor, the effect is a rapid ease of depression symptoms and cessation of suicidal thoughts in as quickly as a day after injection in 70 percent of patients.

Ketamine molecules come in two forms with the exact same molecular formula but different arrangements of atoms. By separating out the more effective variation, J&J is able to lower the ketamine dose used in the new drug.

More importantly, esketamine is given not through an intravenous line directly into the blood, as ketamine is, but as a nose spray.

Manji believes that doctors and patients will be far more comfortable with using an intranasal drug than an IV. He also thinks that esketamine could be very important for depressed patients who have become suicidal, because it works quickly. He says: "Today you basically treat people and lock them up until the drugs take effect."

Esketamine will be used only in clinics, and not given to individual patients. Also, J&J is working on a plan to prevent it from being abused as it develops the drug.

Ketamine

Understanding how ketamine works is crucial because of the drug's limitations. The improvement in symptoms, which are evident just hours after ketamine is administered, lasts only a week to 10 days. In large doses, ketamine can cause short-term symptoms of psychosis and is abused as the party drug "Special K."

To learn more about ketamine, academic researchers organized a trial in New York. At the Icahn School of Medicine's Mood and Anxiety Disorders Program, a part of the Mount Sinai hospital, they have recruited 72 people whose major depressive disorder persisted despite trials of two or more antidepressants. Half of the subjects were given a single, 40-minute infusion of ketamine at a much lower dose than is used in anesthesia. The other half got a 40-minute infusion of another sedative, midazolam, which is not known to have an antidepressant effect.

A day later, both groups' depression had abated, but the response rate among those who got the ketamine was stronger: 63.8 percent vs. 28 percent in the midazolam group. A week after the infusions, the ketamine group's response rate had fallen to 45.7 percent, but remained much stronger than that among the midazolam group, which had a response rate of 28 percent at the end of a week.

James W. Murrough, an assistant professor of psychiatry at Mount Sinai said that ketamine seemed eminently safe and tolerable. But if the medication needs to be administered long term on a regular schedule, the safety and dosing schedules for its longer-term use need to be investigated in larger trials.

Major depression is caused by a breakdown in communication between nerve cells in the brain, a process that is controlled by chemicals called neurotransmitters.

The party drug, ketamine, or as it is known by its street name "Special K," ( a play on Kellogg's Special K breakfast cereal), appears to trigger release of the neurotransmitter glutamate, which rapidly increases the number and function of synaptic connections.

This has focused attention on synaptogenesis, or the restoration of the lost synaptic connections, as a fundamental process for the treatment of depressive symptoms.

Competition

AstraZeneca (NYSE:AZN), the U.K. drug company, Naurex Inc., a pharmaceutical firm in Evanston, Ill., and Cerecor Inc., a Baltimore-based biotechnology company, are developing new drugs for depression that act similarly to ketamine.

Ketamine and the new compounds from AstraZeneca and Naurex all act on the brain's N-methyl-D-aspartate (NMDA) receptors, which are involved in learning and memory. These receptors interact with the neurotransmitter glutamate, the levels of which seem to be out of balance in depression.

Scientists now believe glutamate is a much more appropriate target for treating depression than serotonin, a neurotransmitter affected by selective serotonin reuptake inhibitor (NASDAQ:SSRI) drugs like Prozac and Paxil. The SSRIs' more indirect method of action is the probable reason why there is a time delay before patients feel relief from depressive symptoms.

Naurex is in the middle of a study with 400 patients and it expects to apply for FDA approval of its drug GLYX-13 in early 2016. The company is also studying an oral version.

AstraZeneca is in the middle of a second Phase 2b trial of its AZD6765 compound, testing it in 282 people.

It will likely be at least a couple of years before any of the new drugs reach the market. In the meantime, some doctors cannot wait and are already using ketamine off label with depressed patients.

Investors' Summary

Globally, as many as 350 million people suffer from low mood and feelings of hopelessness. This is a substantial market waiting for improved treatments.

"The rapid therapeutic response of ketamine in treatment-resistant patients is the biggest breakthrough in depression research in a half century," said Ronald Duman, a psychiatrist and neurobiologist at Yale University.

For years, patients suffering from depression have been cycled through one drug after the next, a hit-and-miss approach that also reflects poorly on the research efforts.

AstraZeneca, GlaxoSmithKline and others have experienced bitter clinical setbacks over the years in trying to find new treatments. GSK at some point even quit the field altogether after its research chief declared that there was no way to anticipate the placebo effect in depression studies.

Ketamine is now one of many drugs of abuse getting a closer look for their therapeutic potential. Ecstasy, LSD and other abused drugs are also being studied as legitimate treatments.

For J&J, esketamine is just the beginning. The new understanding of brain receptors that is emerging from this work could result in many new drugs. J&J thinks one particular type of NMDA receptor, called NR2b, could provide a key target. J&J is working on other medicines that hit this pathway.

Sales of J&J drugs rose 4 percent last year and by 10 percent in the first quarter of 2013, thanks to brisk-selling new treatments for prostate cancer, blood clots, diabetes and other diseases.

Jeff Jonas, an analyst with Gabelli & Co. comments:

"Pharma is now J&J's most attractive segment because they have moved past patent expirations and have a large number of new products. The company's other two businesses -- consumer products and medical devices -- are also growing, but have been plagued by product recalls."

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.

Source: From Party Drug To Antidepressant: Johnson & Johnson Vs. Rivals