Psoriasis, a skin disorder expressed by dry, red reptile-like scales, is autoimmune, meaning cells in the body attack cells supposed to help put down the ailment. Several medicines exist, but not without effects that lead to more problems. In what amounts to a psoriasis coup, Can-Fite BioPharma (NYSEMKT:CANF) found a way to clear skin and restore quality of life to those with this miserable disease, inciting no adverse consequences, and contained in a simple pill.
A fast journey, Can-Fite recently set its Phase III plan to use Piclidenoson, formerly CF101, in front of Europe's EMA, our equivalent of FDA but quicker. EMA was receptive. The pivotal study will have all the proper scientific controls in place, where doctors don't know if they're handing out Piclidenoson or sugar pills.
Most important, planned global trials in 400 patients will pit Piclidenoson against the wildly-popular and lucrative Otezla (a blockbuster bringing in billions), from Celgene Corp. (NASDAQ:CELG) for psoriasis. Prior head-to-head studies against Otezla proved favorable and were subsequently published in highly-respected Journal of Drugs in Dermatology. As in the former study, Phase III will seek improvement versus placebo under medical-vetted psoriasis scoring as a first endpoint; the second will expect to show Piclidenoson equal to Otezla in efficacy.
Biologics for psoriasis are dangerous. Injectables operate to harness the immune system but fall short - side effects like respiratory illness are rampant, to name a few. Can-Fite's drug works better. Two biochemical helpers - IL 17 and IL 23 are key. Can-Fite has found a way to employ these crucial players in the autoimmune disease of inflammation that represent different internal pathways than competitors.
Piclidenoson brings information from cells of the body to enable certain functions in the body. How Piclidenoson works is elegant: it targets a biologically essential adenosine receptor to stop action that may result in disease, specifically autoimmune disorders where blood and organs attack themselves. Because Piclidenoson only works on 'bad' cells that cause inflammation, 'healthy' cells are spared; hence, the lack of detrimental side effects.
Inquiring about Can-Fite's choice of receptor to study, I spoke to Pnina Fishman, CEO and founder of Can-Fite, who replied: " The reason we selected A3AR stems out of findings showing it is highly expressed on diseased cells but low expressed on normal cells. This makes it a specific target. This receptor doesn't play a physiological role and is expressed when a disease evolves. So it does not mediate any adverse events".
Two psoriasis pharma stars light up the medical sky - Celgene's compound and another heavy-hitter from Johnson & Johnson (NYSE:JNJ), Stelara, which lists as bad side effects the risk of life-threatening allergic reactions, skin cancer, and blood leakage into the brain that may kill. Yet the drug is about to rake in $3 billion in 2016.
Piclidenoson works differently than Otezla, which is based on an asthma drug as I describe in an earlier article, and whose close biochemical cousin is used for erectile dysfunction. Otezla's common side effects include unbearable migraine, diarrhea and vomiting and even thoughts of suicide, which led 6% of clinical trial patients to voluntarily stop treatment of the drug (see box below for a comprehensive list of psoriasis treatments).
By contrast, Piclidenoson may cause slight sinus trouble and earache, although occurring in a very low percentage of patients.
Financial results reported for the quarter ended September 30, 2016. A $3 million distribution deal was signed with South Korea for Can-Fite's liver drug. Rheumatoid arthritis, long a company goal with a $38.5 billion medical price tag, using Can-Fite's special receptor agonist, moves forward. Another pipeline hopeful is for non-alcoholic liver disease, recently given a green light by medical experts to proceed with Phase II; patient enrollment is targeted during 1Q2017.
Product revenues do not yet exist, but milestone payments continue. Research and development costs rose, as would be expected. Same with general and administrative expense as Can-Fite expands clinical trials. Net loss year-over-year was not wide. Cash stands at nearly $10 million. With an annualized operating loss of approximately $8 million, a return to the markets for capital infusion seems inevitable due to the larger nature of upcoming trials. This has the potential for shareholder dilution.
Large pivotal trials are risky. Many drugs with promise in Phase II could fail in Phase III. Clinical risk is tempered by Can-Fite diligently learning from earlier studies to extend length of treatment time for best results. Investors should be aware that Can-Fite is a small-cap stock; trading is light with scant research coverage - for now. Volatility may be high and plans for commercialization, if and when Piclidenoson succeeds, are not yet formed.
Can-Fite has a golden opportunity to turn medical heads. A new pathway to treating psoriasis, with no bad side effects, welcome to those embarrassed and plighted by this autoimmune disease, will be greeted with open arms. Better yet, medicine for psoriasis without drawbacks will herald a new age where patients sport clear skin with no worry about adverse effects.
Disclosure: I am/we are long CANF, CELG.