Anthera's Lead Drug: A High-Risk, High-Reward Proposition

Includes: ANTH, GSK
by: Chimera Research Group
After the 2000 bubble and crash, the biotech IPO has finally begun to crack open a bit.
First, Ironwood (NASDAQ:IRWD) tested the waters in February with the largest IPO in two years. Anthera (NASDAQ:ANTH) soon followed March 4, raising just $37.1 million after cutting its IPO price from the $13-$15 range to just $7. An additional $17.1 million was raised in a private placement to existing shareholders for a combined $54.2 million. It ended Q1 with $56.7 million. The stock closed at $6.60 Friday.
Anthera has three drugs in clinical development: A-002 for Acute Coronary Syndrome, A-623 for Lupus, and A-001 for Acute Chest Syndrome.
Since its IPO, Anthera has begun recruiting patients into a pivotal Phase III trial for its lead drug, A-002 (varespladib methyl). A-002 is a novel inhibitor of sPLA2, an isoform of PLA2 implicated in acute inflammation. sPLA2 is a very interesting target; inhibition of this enzyme is thought to block the synthesis of a family of pro-inflammatory mediators known as Eicosanoids, which include Prostaglandins and Leukotrienes. COX inhibitors such as Celebrex also have this activity, but have potential side effects.
A-002 is a high-risk, high-reward proposition. The current trial will enroll 6500 patients and last 18 months. Anthera will need to bring a partner on board soon. And although its current Phase III trial is for Acute Coronary Syndrome, it has significant blockbuster potential as a cardiovascular treatment competing with the likes of Lipitor if it proves to be safe and shows improvements in efficacy. GSK has a similar compound in development now in a second Phase III trial. If approved, their drug, darapladib, is expected to reach sales of over $1 billion.

Anthera’s market cap of $150 million reflects the risk embedded in its drug. If GSK’s darapladib does well, I would expect investors to warm up to Anthera’s A-002.

Disclosure: No Position