Tiny Ohr Pharma Challenges The Eye Drug Establishment

| About: Ohr Pharmaceutical, (OHRP)

Tiny Ohr Pharmaceutical (NASDAQ:OHRP) is developing Squalamine, an eye drop formulation for wet AMD (age-related macular degeneration). The drug is in Phase II trials and interim results are expected by the second quarter of 2014.

Squalamine is a novel small molecule that inhibits several growth factors, and eye drops would offer a great advantage over the current practice, which is injections in the eye monthly or bimonthly of drugs made by Regeneron (NASDAQ:REGN) or Roche (OTCQX:RHHBY).

If Ohr's eye drops work in the clinical trials, this small company is a big winner.

Squalamine

Squalamine lactate is an anti-angiogenic drug used for the treatment of tumor-associated angiogenesis. Similar to other treatments used for cancer, squalamine lactate works inside the cell to block the formation of new blood vessels that would feed a growing tumor.

It works against multiple protein growth factors of angiogenesis, including vascular endothelial growth factor (VEGF), platelet-derived growth factor (PDGF) and basic fibroblast growth factor growth factor (bFGF), with high potency at very tiny concentrations. The inhibition converts the actively proliferating endothelial cells into a dormant, normal vasculature.

The potential advantages over Lucentis and Eylea, the current standard of care, are numerous.

Eye drops reduce the side effects of injections, may achieve superior visual acuity outcomes and since Squalamine is a small molecule versus the large molecules currently used, the savings in manufacturing cost could be substantial.

Originally Squalamine was developed as an intravenous formulation, and tested in over 250 patients all the way to Phase III. The trials demonstrated that the molecule had biologic effect and maintained and improved visual acuity outcomes, and in both early and advanced cases, like the so-called "fellow eye," responded so well that the FDA designated a fast track status to it.

But the program had been discontinued for commercial reasons.

40 minute weekly infusions are too burdensome for the elderly patient population and when a monthly dosing was tried, it proved suboptimal. Also, ophthalmologist offices are not equipped to give large scale prolonged infusions.

A major change came when Ohr switched from infusion to eye drops. Studies confirmed tissue concentrations of the drug reaching the necessary levels to be effective. And eye drops do not require ophthalmologists to build infrastructure to accommodate large scale IV infusions.

A Phase II study of the eye drops version is running currently.

In July, Ohr reported that it has enrolled half of the 120 patients needed for a Phase II study.

The significance of the 50 percent enrollment is that it starts the clock running for the interim analysis.

Ohr CEO Dr. Irach B. Taraporewala said:

"This milestone sets the stage for the planned interim analysis once the 60 patients complete the nine month treatment protocol, and we expect the data to be available in the second quarter of 2014."

The primary outcome measures in 9 months are the need for continuing Lucentis injections. All patients receive an initial injection of Lucentis as a first step before randomization and then evaluated monthly for their need for further injections using a protocol defined retreatment criteria.

Secondary outcome measures are the improvement in visual acuity (clearness of vision) and visual function improvement using standard EDTRS charts measured at an initial distance of 4 meters. The adverse events are also measured.

AMD market

There are two forms of AMD: dry and wet. All cases begin as the dry form, but 10 to 15 percent progress to the wet form, which can result in sudden and severe central vision loss.

Dry AMD accounts for 85 to 90 percent of all cases. But wet AMD accounts for approximately 90 percent of all AMD-related blindness and is thought to begin when blood vessels form abnormally at the back of the eye through angiogenesis. The blood vessels leak blood or fluid in the macula and form scars that cause central vision to deteriorate and may result in permanent blind spots.

Approximately 15 million people in the United States have AMD, and more than 1.7 million Americans have the advanced form of the disease. About 200,000 new cases of wet AMD are diagnosed each year in North America. Due to the aging baby boomer population, the National Eye Institute estimates that the prevalence of advanced AMD will grow to nearly 3 million by 2020.

Competition

Ohr is not the only drugmaker trying to improve on the injection approach. U.K. based GlaxoSmithKline Plc (NYSE:GSK) completed a mid-stage study using eye drops, called Votrient.

Glaxo's Votrient "was a less potent drug that acts further downstream in the biochemical pathway," Ohr CEO Irach Taraporewala was quoted by Bloomberg. "They haven't officially terminated their program but both their Phase 2 study results have now read out and they're clearly not moving forward."

In separate news, Roche is trying to repeat Lucentis' success for the dry form of AMD. In the Mahalo trial of its drug lampalizumab, patients with the dry form of AMD experienced a 20 percent reduction in geographic atrophy after 18 months' treatment. In geographic atrophy, cells in the epithelial lining of the retina start to degenerate,.

The current FDA approved market leaders for the treatment of wet AMD are VEGF inhibitors, including Lucentis, Eylea and off-label Avastin. Regeneron's drug can be administered less frequently than Lucentis.

Other programs in development include MP0112, a VEGF targeting DARPin molecule being developed by Allergan (NYSE:AGN), which has been delayed; iSonep, a sphingosine-1-phosphate targeting agent being developed by Lpath (NASDAQ:LPTN) and Pfizer (NYSE:PFE); Fovista, a PDGF targeting aptamer being developed by Ophthotech; and the above mentioned Votrient, a tyrosine kinase inhibitor being developed by GlaxoSmithKline.

All of these products, with the exception of Votrient, use injection into the eye.

Investors' summary

In June, Ohr was uplisted to the Nasdaq and announced a one-for-three reverse stock split required for that. In the reverse stock split, every three shares of outstanding common stock will be converted into one share of common stock. Simply put, a 1-for-3 reverse split means you get one third as many shares, but the price triples.

Ohr's reverse stock split had reduced the number of shares outstanding from 58 million pre-split to approximately 19.3 million post-split. Proportional adjustments were made to the outstanding preferred stock, warrants and stock options as well.

Ohr had $6.05 million in cash on hand at the end of June, including the $5.05 million raised in April from an exercise of warrants. The company has a moderate cash burn of $600,000 per quarter and so it may not need to raise more money through 2014.

The stock price in the past 52 weeks ranged from $2.61 to $8.75 and the market cap is $124 million.

Until the company is able to generate significant revenue from its principal operations, it will have to be considered as a development stage company. But if Squalamine eye drops work in the trials and approved by the FDA, the sky is the limit for the share price.

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.