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Acaida Pharmaceuticals is developing pimavanserin, a potent and selective 5-HT2A inverse agonist, in phase 3 trials for the treatment of Parkinson’s disease psychosis (PDP). Pimavanserin was designed to modulate dopamine transmission by decreasing dopamine release in the brain regions where excessive dopaminergic transmission underlies psychosis, and by increasing dopamine release in brain regions where low levels of dopaminergic activity may cause cognitive deficits.

Previous Work In PDP

Management has tested the drug in two previous phase 3 trials. High placebo responses, specifically in centers outside the U.S., doomed these two trials (Study-012 and Study-014). However, we think there were clear signs of efficacy in those programs. Below are data read-outs from -012 showing the high placebo response in the global population, and the more consistent data in the U.S., on the primary endpoint of antipsychoitic efficacy assessed by the Scale for the Assessment of Positive Symptoms (SAPS). Management stopped the -014 trial early after -012 failed, even though there was clear separation on both the SAPS and CGII endpoints (below, click to enlarge).

Changes in the Current Phase 3 Trial

• Firstly, the trial will test only 40mg pimavanserin vs. placebo in a 1:1 randomization. The previous two programs had 3 arms at a 2:1 randomization (10mg and 40m vs. placebo). Reducing the randomization to 1:1 should help reduce the perception that patients believe they are on drug. It also reduces the statistical hurdle that is required to meet significance to p<0.05. Management saw strong results from the 40mg cohorts during the -012 and -014 trials. We are confident in the efficacy here.
• Second, management will increase the entry criteria of the MPI minimum score required at screening and SAPs score at baseline to target a more severely affected population. The previous trials, which allowed less sick patients to enroll, saw a high placebo response as a result. Management noted that sub-set analysis of the sicker patients saw significantly less placebo-response and greater efficacy with pimavanserin.
• Third, management will employ a two-week structured social therapy lead-in period in order to help pull initial placebo responses ahead of the assessment period. The goal here is to standardize the baseline so that the initial placebo response is muted. This may lower the absolute efficacy figures on pimavanserin compared to the -012 and -014 programs, but should work to create greater separation between pimavanserin and the placebo, which is the ultimate goal of the trial.
• Fourth, management will conduct fewer patient visits during the active dosing portion of the trial. This will limit the interaction between the Parkinson’s patient and the clinician, which may have resulted in improved perception in disease psychosis during the first phase 3 (-012) trial. For example, the patients in the first trial received a significant step-up in quality of care relative to non-participating patients. The additional visits and monitoring of these patients seems to have led to a lower frequency of psychotic episodes. Management has reduced the planned visits in the -020 program to better assess the efficacy of pimavanserin in a more traditional setting for the patient.
• Fifth, management has made these refinements to the SAPS endpoint through analysis of the two previous PDP programs, -012 and -014. The new set of nine items (down from 20) from the hallucinations and delusions domains of SAPS best captured the expression of psychosis in PDP patients. By refining the endpoint, the company believes it can reduce variability and enhance sensitivity of the measure for demonstrating treatment response in PDP. This new modified SAPS endpoint, to be assessed using centralized ratings, has been accepted by the U.S. FDA.
• And finally, the -020 trial will enroll a more homogeneous patient population. The -012 program enrolled patients in seven different countries (U.S., U.K., France, Bulgaria, India, Russia, and Ukraine). Standards of care and patient characteristics differed from the U.S. and, for example, India or Russia. U.S. patients were more predictable and consistent with what was expected versus Eastern Europe or India. The -020 study will enroll patients in the U.S. only.

Cash Position Solid

Acadia's cash position is solid. In January 2011, management raised just over $14 million. We estimate the current cash balance is around $45 million. The company also has earlier-stage development programs with Allergan (AGN) for the treatment of glaucoma and neuropathic pain, and with Meiji Seika to develop a new class of pro-cognitive antipsychotic drugs. Acadia is also working on preclinical candidates for Parkinson's disease through a grant from the Michael J. Fox Foundation.

Acadia's stock has tripled from December 2010. We believe investors are returning to the story given the improved cash position and increased confidence in the ongoing phase 3 trial.

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