Small Company Spotlight: Xenon Pharmaceuticals (XENE)
Summary
Canadian clinical stage biopharmaceutical company committed to developing innovative therapeutics to improve the lives of patients with neurological disorders.
Upcoming phase 2b data in adult focal seizures and partnered program data readouts are near-term catalysts that will have material impact on the company and give insights on the potential of future benefit for patients.
Data in Focus — XEN1101 in Adult Focal Epilepsy
Phase 1b data demonstrated statistically significant effect of 20 mg XEN1101 on changing the resting motor threshold starting at 2 hours and up to 6 hours.
There was also a parallel increase of XEN1101 levels over the 6 hours.
Negatives
Phase 2b data is underwhelming and/or does not provide positive data proving proof-of-concept despite promising phase 1b data and existing clinically validated Kv7 potassium channel mechanism with ezogabine, an earlier generation Kv7 modulator approved by the U.S. FDA.
Limitation to phase 1b data was that the study was small, did not test seizures directly, and whose focus was to understand pharmacologic activity over a few hours.
Positives
Phase 1b data support the likelihood of XENE1101 demonstrating proof of concept in the phase 2 trial.
Kv7 potassium channel mechanism has already been clinically validated with ezogabine, an earlier generation Kv7 modulator approved by the U.S. FDA.
Optionality to invest with XENE on a longer-term given XEN496 phase 3 study is currently underway.
Assessment
Early data and already proven clinical mechanism by ezogabine make me inclined to think that we will see positive proof of concept data by time of the planned dated readout no later than middle of October 2021.
XEN1101 was chemically designed to improve upon potency, selectivity and pharmacokinetics of ezogabine.
If taking a position, a conservative approach would be a small position using October 2021 options in an attempt to capture price action by time of the expected phase 2b data readout in September to middle of October 2021.
Interesting Tidbits
Ownership by Perceptive Advisors, Biotechnology Value Fund, Avoro Capital, Orbimed, New Enterprise Associates, and Boxer Capital.
Partnerships with Neurocrine Biosciences and Flexion Therapeutics with potential for milestone payments and royalties.
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