Nexstim (NXTMH:FH) tried to put a positive spin on the news, but it will need to carry out another trial of its electric field-based stroke therapy, delaying FDA approval until the end of 2018. The company’s stock spiked yesterday as the path to approval for its Navigated Brain Therapy cleared, only to open down 19% today as reality sank in.
At the same time, Bracknor Investment Group exchanged around 10 million shares’ worth of convertible bonds, contributing to the stock decline. Nexstim has enough money to last until early 2018, so it could be looking for more cash around the time the new trial reports. The future of the company will hinge on the results.
For now, Nexstim is looking on the bright side; namely, that it only needs to carry out a small, 60-patient trial, E-Fit, to satisfy the FDA’s requirements for a de novo submission.
The company has also designed a new sham coil, which has been given the thumbs up by the agency. Nexstim will hope that this works better than the sham control used in the previous phase III Niche study – it blamed a high response in the sham group for that trial’s failure (Nexstim heads to US after accidentally treating the sham group, March 31, 2016).
The setback sent the Finnish group’s share price crashing, and it has not yet recovered; its stock is trading at around €0.14, well off its €7.45 high in December 2015.
Fit for purpose?
Nexstim expects to start E-Fit in the first quarter of 2017 and complete it a year later; if the study is successful, the results will be added to its de novo approval application along with the data from Niche.
The FDA has indicated that the de novo pathway, used for devices where no existing similar product exists, is appropriate for the Navigated Brain Therapy system. The agency has also already reviewed the technological and safety sections of Nexstim’s submission, according to the company.
Navigated Brain Therapy uses transcranial magnetic stimulation produced by a magnetic coil to generate an electric field in the part of the brain directly opposite the stroke site. The idea is that this field attenuates neural function, forcing the stroke-damaged nerves to pick up the slack, thereby recovering function.
But the jury is still out on its efficacy. Niche enrolled 200 patients who had had an ischaemic or hemorrhagic stroke on one side of the brain, resulting in upper extremity paresis, 3-12 months before the study. The primary endpoint was change in the upper extremity Fugl-Meyer scale, a measure of upper limb motor function, six months after treatment.
It is unclear yet whether E-Fit will evaluate the same patient population and primary outcome. One thing, however, is certain: if Nexstim wants to continue, it is vital the study is a success.