Invex Therapeutics (ASX: IXC) shares are down 52% today in Australia on the back of disturbing news - they can't find enough patients for the necessary drug trial. In one sense this is merely a logistical problem, one that might well get solved at some point. On the other, how big is the likely market for a drug when you can't find a couple of hundred people to test it upon? If we're to be cynical about things that is.
We can also look at Invex as an excellent example of the volatility of investing in pharma development. Only a couple of days back we had the news of orphan drug designation: “announces the granting of orphan drug designation (ODD) from the European Medicines Agency (EMA) for Exenatide in the treatment of moderate to severe Traumatic Brain Injury (TBI). This is the second ODD for Exenatide in Europe, with Invex receiving an ODD for Idiopathic Intracranial Hypertension (IIH) in 2017, alongside an ODD from the US Food and Drug Administration (FDA), also for IIH.” OK, that's great, that's very good in fact. That lowers the costs of testing the drug, that also protects the results of having tested it. But, obviously, it is still necessary to go out and actually test it.
That news, about the orphan drug designation, gave that jump in the IXC share price from $0.40 to $0.60. Which was followed by this new news of course.
Invex Therapeutics share price from ASXThat new news: “Lower than expected enrolment trajectory for IIH EVOLVE Phase III trial, due to higher screening failures and slower site activations than expected” They're finding it really hard to find enough patients suffering from the problem and also willing to enter the trials. As we say above that doesn't bode well for the addressable market of the drug.
But there's another problem: “In parallel, the Company will complete a detailed market assessment initiated to understand the risk of approved GLP-1 receptor agonists to Invex's IIH market opportunity”. Other people are developing other drugs - entirely different - which address the same problem. And, what isn't said, if they get to market first then there may not be an opportunity for IXC at all.
It's possible to see why the Invex share price has dropped 50% and more on this news. None of this is immediately catastrophic - it's not the same as if the drug had actually failed tests. But it all is value reducing and there's no obvious reason why there should be a bounce back in the immediate future.
