On the verge of commercializing two CNS technologies Print E-mail
By Irfan Cehajic   
Monday, 15 November 2010 09:41

Penny Stock PickAfter years of research, Bioasis Technologies (TSX-V:BTI) a small Canadian biotech company is on the verge of commercializing two "holy-grail" technologies in the field of central nervous system (CNS) disorders.

The first is the long sought-after simple blood test for diagnosing Alzheimer's disease (AD). The second is a carrier of therapeutics across the blood-brain barrier (BBB), the primary obstacle to treating many diseases including inoperable brain tumors and Parkinson's.

The potential of both these technologies to deliver breakthroughs in fight against some of the worst diseases plaguing humanity today is immeasurable. The CNS disorders market is already one of the biggest, valued at more than US$98 billion per annum with an 8% annual growth. Yet many of the CNS diseases cannot be treated either due to lack of a suitable diagnosis method or due to inability of 95% of drugs to cross the BBB.

Diagnosing Alzheimer's Disease

AD is one of the most cruel and costliest diseases plaguing our society today. This incurable, degenerative, and fatal disease is affecting roughly 30 million people worldwide, 5.3 million of them in the US. With an aging population this number is expected to double every 20 years.

Based on the recently released World Alzheimer Report 2010: The Global Economic Impact of Dementia the total societal cost of AD in 2010 is estimated at $360 billion. That is almost as high as the 2009 GDP of the oil producing giant - Saudi Arabia.

Not only is there no cure for AD, there isn't even a reliable test for diagnosing it. Even today, the only definitive diagnosis can be reached after the patient dies and the brain is examined for plaques and tangles, two of the main features of AD.

After decades of research and over 500 clinical trials we don't have a drug to halt or even delay progression of the disease. Lack of simple test is a major obstacle, so much so that this summer a New York Times article praised as revolutionary the new opportunities to diagnose the disease with the aid of MRIs, brain scans, and spinal taps. These methods are costly and time consuming making them impractical.

Bioasis' Cognitestâ„¢

Bioasis Technologies' Cognitest is a simple blood test for AD. After years of development and several successful proof of concept studies, the commercial version of the product is in the final stages of development in collaboration with the UK-based Fleet BioProcessing. Once complete, the test will be validated by scientists at the prestigious King's College London. And, if things go according to plan, Bioasis expects to gain European Union regulatory approval in early 2011.
Validating study will be an important indicator of how effective Cognitest will be. Data from the independent study suggests that the test will be very accurate for AD patients at the possible and probable stages of the disease. This is vitally important in diagnosing AD versus other forms of dementia, something most clinicians struggle with on a daily basis.

Where the test can make a drastic impact is if it can detect AD before any symptoms of the disease become obvious. Benefits of this are that people who know they will be developing AD in a few years time can try preventive therapies such as Vitamin B12 injections and enrollment in AD clinical trials.

Crossing the Blood Brain Barrier

The World Health Organization has identified CNS disorders as the major medical challenge of the 21st Century. Despite the large market segment, most CNS disorders do not have an adequate treatment today. This is due to the complexity of the brain and the BBB.
The blood brain barrier acts as a protector of the CNS, and while effectively protecting the brain from many common bacteria and infections, the BBB also severely limits the movement of potential medicines into the brain.

Bioasis' Transcendâ„¢

Transcend is a carrier for delivery of therapeutic agents across the BBB. It is based on p97, a naturally occurring protein that is able to cross the BBB. Studies have shown that Transcend is capable of delivering a range of different molecules across the BBB and accumulating the same in the brain parenchyma.
Transcend's ability to transport a wide range of drugs across the BBB is of interest to every major pharmaceutical company, as well as to a number of mid-size CNS specialty companies such as Lundbeck.

The company has already initiated internal development programs with a select target of drug candidates. Results from these programs should be available in 2011.
In May of 2009, a major US biotech company has engaged in testing of Transcend for possible collaboration with Bioasis. It is expected that there will be a progress update announcement by Q1 of 2011.

The Opportunity

It is rare to see such an incredible potential in any market. Bioasis is now in the final stretch towards commercialization where, within a few months, several key developments will shape this company's future.

Cognitest may soon become a household name with Bioasis featured on Dr. Oz's show with their ground-breaking achievement.
The company is estimating that the revenues from Cognitest royalties, to Bioasis, would start in 2011, growing to $20M-$30M annually by 2016.
Transcend is targeting one of the most lucrative pharmaceutical market segments where the top 10 CNS drugs have revenues between $2B-$5B per annum. For each drug that Transcend is combined with 100s of millions of dollars can be expected in royalty payments to Bioasis.
I love investing in well managed, early stage companies with huge upside potential. Bioasis is one such company. With only 28M shares out, an experienced management team, 35%
ownership by the management and insiders, and two ground-breaking products, I believe Bioasis Technologies has the potential to be a ten bagger within the next 12-18 months.

Irfan Cehajic is the editor of TechnicalBuy Investment Newsletter, TechnicalBuy.com

Disclosure: Long

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