It seems only recently that the company wrapped up the completion of Phase 2a clinical trials for its respiratory syncytial virus (RSV) drug BTA585, but Aviragen Therapeutics (NASDAQ:AVIR) is straight back in catalyst-territory, with a lot going on in the New Year. Topline data for BTA585 is should hit press by January 31st according to the British Pharmaceutical Codex (BPC). Additionally, and slated for sometime this quarter, these topline results out of the UK will be followed by a response from the company related to the Food and Drug Administration (FDA)’s hold on the drug, subsequent to which the company hopes the agency will remove the clinical hold currently in place.
BTA585, an oral fusion protein inhibitor, commenced its Phase 2a RSV CHALLENGE efficacy study at the beginning of April 2016. In the double-blind, placebo-controlled study, testing the safety and pharmacokinetic results of both single and multiple ascending doses, it was determined that BTA585 was generally well tolerated at all levels. There was no occurrence of clinically significant adverse events, changes in ECGs, or abnormal clinical lab values.
These positive trial results out of the UK are a huge indicator of success for the drug, which, despite originally receiving Fast Track designation by the FDA in February 2016, was placed on clinical hold mid-year. Having invested twenty-six million dollars into clinical trials, AVIR is, naturally, working with the FDA to resolve the issue.
If resolved, i.e. if the agency lifts the hold, management has stated (as per the most recent conference call) that it will have to conduct some juvenile animal toxicity studies, and that these will take up to a year (perhaps a little less) to complete. Aditionally, the lifting of the hold will also pave the way for some adult studies in the US. Both of these developments represent catalysts, but none are particularly near term – this company is going to be something of a slow burner after the UK data drop.
On a macro scale, Aviragen Therapeutics is focused on the discovery and development of the next generation of direct-acting antivirals. More specifically, antivirals to treat infections that often have limited therapeutic options – although they affect a huge number of people worldwide. Aside from BTA585, the company has two other product candidates currently in clinical development. Firstly, Vapendavir, an oral treatment for human rhinovirus (HRV), which is an upper respiratory infection that occurs in moderate-to-severe asthmatics; and, secondly, BTA074, a topical antiviral treatment for condyloma caused by human papillomavirus types 6 & 11.
Aviragen, along with several other companies, is at the helm of a growing market with a growing demand for novel products for the treatment of RSV. In the eighteen months alone, we’ve seen a number of major developments in the space, and it these developments have put pressure on both Aviragen and market sentiment towards the company, from a competition perspective. In September 2015, OrbiMed and Edmond de Rothschild Investment Partners co-led a $21 million investment in ReViral, a London-based company that is developing RV521, a drug for the treatment of RSV. In June 2016 ImmunoVaccine Inc. (CVE:IMV) commenced a phase I clinical study of its DPX-RSV vaccine, which decreases the severity of RSV infections. Lastly, in January 2016, Mucosis received $4.1 million funding from the Wellcome Trust – a global charitable foundation focusing on improving health – to advance SynGEM, the company’s intranasal RSV vaccine.
According to speculators, these companies are likely to continue to positively change the market dynamics moving forward. The attention to, and in-turn market value of, the development of novel drugs for the treatment of RSV is rapidly growing. One big driver for this market growth is the presence of large patient pool: RSV is the leading cause of lower respiratory tract infections in infants and young children. In fact, each year 4-5 million children under four years of age acquire an RSV infection, resulting in hundreds of thousand infants being hospitalized annually in the US.
So, the takeaway? This is a big market, and we could see a down on its luck company pick up some upside momentum if things start to move in its favor. Keep an eye out for the topline results expected to hit press at some point before January 31st, and watch for a company response on the FDA’s decision regarding the current hold on BTA585. If we see a response this quarter, the hold could potentially lift during Q2.
