I believe that Annovis Bio (NYSE:ANVS) is a great speculative biotech play to look into. The reason why I say that is because I believe it can offer great value for investors. It is targeting large market indications and the two of them are Alzheimer's Disease [AD] and Parkinson's Disease [PD]. The lead drug being used to target both of these diseases are Buntanetap, which is given orally. Other indications that are being explored with the use of this drug are Alzheimer's Disease in down syndrome, frontotemporal dementia, and chronic traumatic encephalopathy. Besides the use of its main pipeline drug Buntanetap, it is also developing a few other drugs to go after neurodegenerative diseases. ANVS405 is an injectable drug being developed for traumatic brain injury and stroke. Lastly, you have ANVS301 for advanced Alzheimer's Disease as well. The big thing is that Buntanetap is the most advanced program in the pipeline. Why I believe this is a biotech worth exploring is because proof of concept in using this specific drug for PD has already been established in a phase 2 study. A phase 3 study was just initiated in August of 2022 and this study should take a few years to run. Buntanetap not only established proof of concept in PD, but it was also shown to help improve cognition in AD patients in this phase 2 study as well. However, thus far Annovis only received clearance to initiate two phase 3 studies in PD. One study will be for early PD and the other will be for late-stage PD. As far the AD indication goes, Annovis Bio is awaiting end of phase 2 meeting talks to see what type of phase 3 study can be done for it.
The first program to go over involves the use of Buntanetap, which is being developed for the treatment of patients with Parkinson's Disease. Parkinson's Disease is a problem because the central nervous system is greatly affected. This involves causing movement problems and possible tremors for patients also. Why does it occur? It occurs because of damage that happens with the nerve cells of the brain. In turn, this causes the brain's dopamine levels to drop off causing PD. Several symptoms include:
There are medications currently that help control some of these symptoms, but more treatments are needed that target the underlying cause of the disease. It is estimated that the global Parkinson's Disease market is expected to reach $8.38 billion by end of 2026. As you may or may not know, most PD treatments increase dopamine levels to make up for the loss that occurs in nerve damage.
As I highlighted above, Annovis Bio already held an end-of-phase 2 meeting with the FDA to discuss the potential to advance Buntanetap forward into a phase 3 study. It held a positive meeting outcome and both Annovis and the agency came to an agreement on what the trial design should be. As such, the first phase 3 trial being explored will be the use of this drug for the treatment of early PD patients specifically. The goal is to enroll about 450 PD patients who have low scores of Hoehn and Yahr (scores of 1, 2 and 3). What type of score is this? In essence, this score measures the functional disability associated with PD. It measures symptom progression that occurs for these patients. Being that this trial will primarily deal with early-stage PD patients, this is why only those patients with lower scores are being recruited. Patients are going to be randomized 1:1:1 into the following doses:
The patients will receive one of these three doses once-daily on top of current SOC treatment for PD over a 6-month period. The primary endpoint is going to be dealing with Movement Disorder Society-Sponsored Revision of the Unified Parkinson's Disease Rating Scale part II and III. On the other hand, total MDS-UPDRS and Participant Global Impression of Change will be the secondary endpoints for this study. There are going to be other exploratory endpoints as well, but the key endpoints to focus on would be the primary endpoints. The MDS-UPDRS scale measures motor and non-motor experiences of daily living for these patients. Motor evaluation is important in determining how severe the disease is. Consider it like a 50-question assessment on both motor and non-motor functions found for PD. Part II looks at disability assessment and then part III is for movement disorders being observed.
I believe Annovis Bio will do better in the long-run when it comes to the PD indication. I state that because it obtained some really good results in PD patients taking Buntanetap. This is why it is advancing two phase 3 studies first for this indication. The point here is that it has already established proof of concept that this drug is able to achieve substantial motor improvements for these patients over placebo. Such positive results come from the phase 2 study which expanded to 54 PD patients. It was shown that once-daily Buntanetap resulted in improvement of motor functions. As I will show right now, it was able to achieve the endpoint of MDS-UPDRS over placebo with statistical significance. PD patients who took 10 mg and 20 mg once daily of Buntanetap achieved statistically significant improvements in the UPDRS part 2, part 3 and part 4 and in total MDS-UPDRS test compared to baseline. Such a measurement was statistically significant with a p-value of p<0.5. the drop in UPDRS % total score in those who took placebo was around -10%, whereas those taking either 10 mg or 20 mg Buntanetap obtained -16% and -15% respectively. With this positive data on hand, this why Annovis Bio is moving forward to phase 3 studies. Again, the first goal is to go after early-stage PD patients first and then it will also likely initiate another phase 3 study going after late-stage patients thereafter. The important takeaway or notice here is that the phase 3 study, which had just dosed the first PD patient with Buntanetap in August of 2022, is deploying MDS-UPDRS part 2 and 3 as the primary endpoint. Having already established this endpoint in a smaller population, there is a good chance that it should achieve a similar outcome in this late-stage study as well. Going from 54 patients to 450 patients is a huge thing and this could change the final outcome of data. This type of increase in patients being recruited is a huge risk. There is no guarantee with certainty that statistical significance for MDS-UPDRS part 2 and 3 will be achieved because of such an increase in sample size. A positive thing to note is that the late-stage study is going to deploy a much longer dosing schedule, whereas the phase 2 study did not. Whether or not extended treatment time will result in superior motor improvements for these patients remains to be seen.
According to the 10-Q SEC Filing, Annovis Bio had $36 million in cash, cash equivalents and marketable securities as of June 30, 2022. This biotech has been able to finance itself through the use of selling shares of its common stock, redeemable convertible preferred stock and convertible promissory notes and even research grants. The reason for the current cash on hand is that it closed an offering back on May 26, 2021. That is when it sold a total of 1 million shares of its common stock at a public offering price of $50 per share. Of course, its stock traded much lower since then. It believes that it has enough cash to fund its operations for at least the next 12 months from the date of the 10-Q SEC filing which was filed on August 8, 2022. Even though it states this, there is one major thing to consider, which is that it expects costs in 2022 to dramatically increase. This is largely due to the fact that it will now have a late-stage program ongoing, which costs a lot of money to run. Having said that, I believe that it will likely have to raise cash in early 2023 at the earliest. Keep in mind that if it feels that financial conditions/markets are worsening or it reports positive news, then it won't hesitate to raise funds immediately.
There are several risks that traders/investors should be aware of before investing in Annovis Bio. The biggest risk would be with respect to the most advanced program in the pipeline, which is dealing with the ongoing phase 3 study using Buntanetap for the treatment of early Parkinson's Disease patients. A prior phase 2 study showed that treatment with this drug was not only safe, but that it achieved statistical significance in motor function improvement. There is no guarantee that this phase 3 study will be able to achieve statistical significance with respect to this primary endpoint. Again, the primary endpoint is looking at both aspects of motor improvement scores, which are MDS-UPDRS Part II and III. Another risk to consider would be with respect to the use of Buntanetap for the treatment of patients with Alzheimer's Disease. While the company received clearance to initiate a late-stage study using this drug for early-stage PD patients, there is no guarantee it will receive clearance to start a phase 3 study for AD patients. This may possibly happen, but with respect to the phase 2 study data released, I believe that Buntanetap performed better in patients with PD. The final risk to consider would be with respect to the financials that I listed above. That's because again, it does not have a lot of cash on hand and I believe it will need to raise additional cash in the coming months. If it can wait until early 2023 to raise additional cash that would be ideal. However, if the stock market/financial conditions worsen, it may need to do so a lot earlier than anticipated.
The Final Conclusion is that Annovis Bio is a great speculative biotech play to look into. As I stated above, it is already in great shape because it has established proof of concept in using Buntanetap for the treatment of patients with Parkinson's Disease. Not only that, but it has already received clearance from the FDA to initiate a phase 3 study in using this particular drug to treat early-stage PD patients. Another aspect to consider is that it might also receive clearance to initiate another phase 3 program as well. This is dealing with respect to its ability to possibly start a phase 3 study using Buntanetap for the treatment of patients with Alzheimer's Disease. However, this highly depends how the end of phase 2 meeting goes for this specific indication. Buntanetap is also being explored in other areas as I described above in the beginning. Other indications being explored with the use of this drug are: Alzheimer's Disease in down syndrome, frontotemporal dementia, and chronic traumatic encephalopathy. Still, there are other drugs in the pipeline it has that act as back up options. For example, ANVS301 is being explored in a phase 1 study for advanced AD and dementia, which is being funded by the National Institutes of Health. Then, it has another drug by the name of ANVS405 which is being explored in IND-enabling studies for Traumatic brain Injury and stroke. With advancement of its main drug Buntanetap for the treatment of patients with PD, plus the potential to also advance the very same drug for AD as well, these are the reasons why I believe that Annovis Bio is a great speculative biotech play to look into.
This article is published by Terry Chrisomalis, who runs the Biotech Analysis Central pharmaceutical service on Seeking Alpha Marketplace. If you like what you read here and would like to subscribe to, I'm currently offering a two-week free trial period for subscribers to take advantage of. My service offers a deep-dive analysis of many pharmaceutical companies. The Biotech Analysis Central SA marketplace is $49 per month, but for those who sign up for the yearly plan will be able to take advantage of a 33.50% discount price of $399 per year.
This article was written by
I am the Founder of Biotech Analysis Central, A subscription service on Seeking Alpha's Marketplace. If you want to learn more about biotech investing or you want to check out my biotech analysis you can do so with a free 2-week trial to my service. Just hit the "Learn More" button on the bottom of the Marketplace Research Tab. I have a Bachelors of Applied Science Degree In Technology Management, Industrial and Business Services Management from St. Petersburg College Florida. I have been investing in biotech stocks for many years, and I prefer to invest as a long term investor. With that In mind I seek stocks that have long term value! I primarily Like to Invest In biotechnology stocks and I accept the risks. I Write for the Healthcare Sector and Stock market in general. I contribute to Seeking Alpha.
You can follow me on stocktwits.com under the name BiopharmaPro where I currently have (62.5K) followers. Join me in my quest to find the best biotechnology stocks that deliver results to help patients with new treatment options.
Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such 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.