Adeona Pharma (AMEX:AEN): Late-Stage Pipeline Targeting Large Markets Print E-mail
By Michael Vlaicu   
Friday, 04 September 2009 04:25

Adeona Pharmaceuticals, Inc. (Public, AMEX:AEN) StocksHaven Investments takes a look at Adeona Pharmaceuticals, Inc. which currently has three blockbuster drugs in phase III, and are coming close to NDA status.


The first being Trimesta, which tackles Multiple Sclerosis (MS) and Post-partum Depression. Secondly, Zinthionein, a product seeking treatment for Age Related Macular Degeneration (AMD). Lastly, Oral dnaJP1 which is an immunotherapy for rheumatoid arthritis (RA) patients. If these products aren't enough to entice your way into purchasing this stock, take a look at the recent $5 million dollar cash infusion from the National Multiple Sclerosis Society (NMSS), billions of dollars in product market potential, purchasing of Hartlab LLC, an independent Chicago-area CLIA-certified clinical reference laboratory, an experienced management team that will have you feeling like a kid in a candy store, and to top it all off a stellar balance sheet comparative to other small caps. Simply put, Aedona offers the complete package to any biotech investor's portfolio.

About

Products

Trimesta is perhaps the company's bread and butter. It is a drug which is being used and researched as a treament for both Multiple Scleroris (MS) and Post-partum Depression.

Trimesta Treatment for Multiple Sclerosis (MS) They are developing Trimesta as an oral immunomodulatory therapy for female relapsing-remitting MS patients that can be used either alone or in combination with other agents or during the post-partum period following pregnancy. There are currently five FDA-approved first line therapies for the treatment of relapsing-remitting multiple sclerosis: Betaseron®, Rebif®, Avonex® and Copaxone®. These therapies provide only a modest benefit for patients with relapsing-remitting MS and therefore serve to only delay progression of the disease. All of these drugs require frequent (daily to weekly) injections on an ongoing basis and are associated with unpleasant side effects (such as flu-like symptoms), high rates of non-compliance among users, and eventual loss of efficacy due to the appearance of resistance in approximately 30% of patients. An estimated two-thirds of MS patients are women.

Clinical Trial Results of Trimesta Trimesta™ has completed an initial 10-patient, 16-month, single-agent, crossover, phase II clinical trial in the U.S. for the treatment of MS.

  • Decrease in Volume and Number of Myelin Lesions - The median total enhancing lesion volumes decreased by 79% (p=0.02) and the number of lesions decreased by 82% (p=0.09) within the first three months of treatment with Trimesta™. Over the next three months, lesion volumes decreased by 82% (p=0.02) and the number of lesions decreased by 82% (p=0.02) compared to baseline. During a three-month re-treatment phase of this clinical trial, relapsing-remitting MS patients again showed a decrease in enhancing lesion volumes (88%) (p=0.008) and a decrease in the number of lesions (48%) (p=0.04) compared to baseline
  • Improvement in Cognitive Test Scores - During this phase II clinical trial, a 14 percent improvement in Paced Auditory Serial Addition Test (�PASAT�) cognitive testing scores (p=0.04) was observed in these MS patients at six months of therapy. PASAT is a routine cognitive test performed in patients with a wide variety of neuropsychological disorders such as MS.
  • TRIMESTA is currently the subject of a double-blind, placebo-controlled phase II/III clinical trial that will take place at seven sites in the U.S., enrolling up to 150 female MS patients. Investigators will administer TRIMESTA to women between the ages of 18-50 who have been recently diagnosed with relapsing-remitting MS.
  • This clinical trial has received a $5 million grant from the National Multiple Sclerosis Society (NMSS) in partnership with the National MS Society's Southern California chapter, with support from the National Institutes of Health (NIH).
Market Opportunity for Multiple Sclerosis MS is a chronic, usually progressive disease of the central nervous system in which the immune system attacks and destroys the structure, and therefore degrades the function, of nerve cells. Approximately 400,000 Americans have MS, and virtually every hour someone is newly diagnosed. Most are between the ages of 20 and 50, and women are affected two to three times more often than men. Worldwide, MS may affect 2.5 million individuals. According to the National MS Society, the economic cost of care for MS patients in the United States including medical and non-medical care, production losses, and informal care exceeds $23 billion annually, or more than $57,000 per U.S. patient per year. Complications from MS may make it harder for people to work and may interfere with their ability to perform common, daily activities. During 2006, combined sales estimates of FDA-approved injectable MS therapies, which include Avonex, Betaseron, Copaxone, and Rebif, totaled approximately $5.0 billion. Trimesta Treatment for Post-partum Depression Based upon the observations of our clinical investigators of mood-elevating benefits of Trimesta™ and the dramatic decline of estriol levels immediately post-partum, we also intend to commence a phase II/III trial of Trimesta™ for the treatment of post-partum depression. Market Opportunity for Post-partum Depression Postpartum depression is considered to be a major depressive episode that may be associated with anxiety, persistent depression, irritable mood, or prolonged anxiety. It presents with typical depression symptoms, which can include poor concentration, problems with memory, difficulty with decision-making, irritability, decreased appetite, loss of sleep, loss of pleasure in usual daily activities, low self-esteem, negative thinking, worrying, persistent sadness, helplessness, and feelings of hopelessness. Another aspect of postpartum depression is the mother’s feeling of significant impairment or inability to care for her newborn baby or herself. The mother may also experience difficulty socializing. Some suggest such problems arise as the mother tries to adjust to the realities and demands of her new baby. Recent research also suggests that delivery of the fetus and expulsion of the placenta results in an abrupt decrease in levels of hormones such as estriol, and that these decreasing hormone levels are responsible for postpartum depression. The difference between postpartum “blues” (also referred to as “baby blues”) and postpartum depression is that postpartum blues is short-lived and ends without treatment in a short period of time. It is estimated that the postpartum blues affects 50% of all births and postpartum depression affects 25% of all births. According to a recent U.S. census, there were over 4 million new births in the U.S. Zinthionein (Oral ZMC), the second product is an novel covalently linked form of zinc-monocysteine complex that has been developed by Dr. David Newsome, a leading clinical scientist and inventor of Ovuvite and Preservision, two marketed products for the treatment of AMD. Adeona is developing Zinthionein (oral zinc monocysteine), an orally active compound for the treatment of dry age-related macular degeneration (AMD). Oral ZMC increases the activity of antioxidant enzymes catalase and glutathione peroxidase, and the antioxidant protein metallothionein in cultured retinal pigment epithelial cells more efficiently and potently than currently available zinc formulations. These complexes are the subject of a recently issued U.S. Patent covering its composition of matter and a patent application and various uses thereof. Oral ZMC has completed an 80 patient phase II clinical trial for the treatment of Dry AMD. Clinical Study - Age-Related Eye Disease Study (AREDS) This proprietary molecule builds on the success of the Age-Related Eye Disease Study (AREDS), a randomized, placebo-controlled clinical trial funded by the National Eye Institute. AREDS evaluated over 4,757 patients between the ages of 55 and 80 for an average of 6.3 years. Scientists found that people at high risk of developing advanced stages of AMD, lowered their risk by approximately 25 percent when treated with a high-dose combination of anti-oxidants and zinc. In the same high risk group, which includes people with intermediate AMD, or advanced AMD in one eye but not the other eye, this combination reduced the risk of vision loss caused by advanced AMD by about 19 percent. The AREDS study also demonstrated that reduced vision in advanced AMD patients was also correlated to reduced cognitive function. Market Opportunity for Age Related Macular Degeneration (AMD) Macular degeneration is a progressive eye condition affecting as many as 15 million Americans and millions more around the world. The disease attacks the macula of the eye, where our sharpest central vision occurs. Age Related Macular Degeneration (AMD) is the number one cause of vision loss and legal blindness in adults over 60 in the U.S. As our population ages, and the "baby boomers" advance into their 50's and 60's, we will see a virtual epidemic of AMD. Perhaps 14%-24% of the U.S. population aged 65-74 years and 35% of people aged 75 years or more have the disease. Oral dnaJP1 Oral dnaJP1 is a once-daily epitope specific immunotherapy for rheumatoid arthritis (RA) patients. Oral dnaJP1 contains the five amino acid cassette present on most of the HLA class II alleles associated with RA. In preclinical work, the most relevant epitope was mapped and showed its contribution to pro-inflammatory T cell responses in vitro in patients with active RA. The mechanistic hypothesis is that mucosal tolerization to dnaJP1 could determine immune tolerization primarily of T cells and secondarily of APC. The effects of immune tolerance are initially peptide-specific but affect secondarily non-epitope specific pathways. Immune tolerance could translate into clinical benefit. Highly Successful Phase II Trials Below is a summary of the response data from the phase II clinical trial for oral dnaJP1 at the ACR20 endpoint along with the percentage of ACR20 response at day 112, 140 and 168 as well as day 112, 140 and 168 and day 196 follow-up without further drug therapy.

Oral dnaJP1 ACR20
AUC Days 112, 140, 168 and 196 P=0.04
AUC Days 112, 140, 168 P=0.09

ACR20 is a composite endpoint developed the American College of Rheumatology and generally accepted as an FDA approvable scoring criteria. Consistent with the disease modifying process of active immune tolerization, there was a progressive separation between treatment and placebo groups for both ACR20 and ACR50 endpoints was after day 112. Oral dnaJP1 treated patients achieved a 40.7% ACR20 response at follow up versus 21.5% of placebo-treated patients (CMH test p=0.007, GEE p<0.001). The proportion of dnaJP1-treated patients who achieved an ACR20 response at Days 112, 140, 168, and follow up was significantly higher than that of placebo-treated patients (CMH p=0.03; GEE p=0.0005). From an immunologic standpoint, oral dnaJP1 also demonstrated an 80% reduction in the production in-vitro of TNF-alpha by T cells (p<0.007), a hallmark cytokine of inflammation. Additionally, oral dnaJP1 treated patients demonstrated an increase in tolerogenic cytokines and immune response genes, including IL-10 and FoxP3 production. Market Opportunity for Rheumatoid Arthritis Rheumatoid arthritis is a chronic inflammatory disease that leads to pain, stiffness, swelling and limitation in the motion and function of multiple joints. If left untreated, rheumatoid arthritis can produce serious destruction of joints that frequently leads to permanent disability. Though the joints are the principal body part affected by rheumatoid arthritis, inflammation can develop in other organs as well. The disease currently affects over two million Americans, almost 1% of the population, and is two to three times more prevalent in women. Onset can occur at any point in life but is most frequent in the fourth and fifth decades of life, with most patients developing the disease between the ages of 35 and 50. Over 20 million people suffer from rheumatoid arthritis worldwide. Rheumatoid arthritis treatments comprise a $13 billion market. Enbrel, a leading injectable rheumatoid arthritis treatment sold by Amgen and Wyeth, reported US sales in 2007 of about $3.2 billion. Financial Analysis Comparative to other small cap biotech stocks, Adeona stands in a class of its own with its superb balance sheet. Current assets of $4,514,604, and Liabilities of only $574,404 ensures the company has enough cash on hand to sustain ongoing operations through rigurous research and development of its innovative drugs. As well, marketing and mass production shouldn't be a problem, especially if more grants roll in such as the $5 million dollars from the National Multiple Sclerosis Society (NMSS). Aedona also decreased its Q2 net loss. They have reported a net loss of $879,550 or $0.04 per share, for the second quarter of 2009, compared to a net loss of $1.11 million or $0.05 per share, for the second quarter of 2008. The company has also reported a net loss of $2 million, or $0.09 per share, for the first half of 2009, compared to a net loss of $4.86 million, or $0.24 per share, for the same period of 2008. Max Lyon, president and CEO of Adeona, said: "We are pleased with our progress in the second quarter, particularly the acquisition on Hartlab which now gives us the near term opportunity to enter the market with the only comprehensive diagnostic test panel available for determining the copper and zinc status of patients with neurodegenerative diseases such as Alzheimer's disease, dementia and mild cognitive impairment. "Based on the new data we presented at the International Conference on Alzheimer's isease, combined with the existing peer reviewed data available, we believe that the comprehensive determining of copper and zinc status combined with the appropriate follow on therapeutic actions could have a significant impact on the progression of these diseases." Experienced Management and Board of Directors A truly unparamount list of well versed individuals, who have been through the thick and thin of the biotech industry many times before:

Steve H. Kanzer, CPA, Esq Chairman & Chief Executive Officer Mr. Kanzer is our co-founder of Adeona and served as our President from our inception in February 2001 until May 2006. From September 2004 through July 2008, Mr. Kanzer also served as Chairman and Chief Executive Officer. Mr. Kanzer has also been ... Read full bio »

Nicholas Stergis, M.S. Vice Chairman of the Board Mr. Stergis is our co-founder, Vice Chairman of our board of directors, and Chief Executive Officer. Mr. Stergis previously served as our Chief Operating Officer from our founding during 2001 until October 2006. From 2003 until 2007, Mr. Stergis w... Read full bio »

Jeffrey J. Kraws Director Mr. Kraws is a director of Adeona. Mr. Kraws was our Vice President of Business Development during 2006. Mr. Kraws is Chief Executive Officer and co-founder of Crystal Research Associates. Well known and respected on Wall Street, Mr. Kraws has ... Read full bio »

Jeffrey Wolf, Esq. Director Mr. Wolf, currently serves as one of the directors of Adeona. Mr. Wolf has substantial experience in creating, financing, nurturing and growing new ventures based upon breakthrough research and technology. Mr. Wolf is the founding partner of See... Read full bio »

James S. Kuo,M.D., M.B.A. Director James S. Kuo, M.D., M.B.A. is the Chairman and Chief Executive Officer of Cordex Pharma, Inc., a publicly-traded company focused on clinically developing new pharmaceuticals for cardiovascular diseases. From 2003 to 2006, he served as founder, Cha... Read full bio »

Overall Sentiment

With the company engaging in products targeting billions of dollars in market potential, on a surface level it is easy to see why this stock has a 52wk high of $1.10. However, the real gem lies within the company, rather than what the eye can see. The sound balance sheet intermixed with its uncanny ability to attain grants worth millions of dollars to ensure ongoing operations, acquisitions of Colwell Clinical Laboratories and Hartlab LLC which broadens Adeona's target market, and last but not least a management team which can effectively lead towards a successful future. Expect short term, and long term prices to rise, reaching the $1 mark as Adeona gains exposure. Simply put, an investment like Adeona comes once in a blue moon.

The company is mainly a development-stage, specialty pharmaceutical company that is developing proprietary, late-stage drug candidates for the treatment of autoimmune and central nervous system (CNS) diseases. Their strategy is to exclusively in-license proprietary, clinical-stage drug candidates that have demonstrated clinical efficacy for the treatment of unmet medical diseases. They are specifically focused on developing oral therapies for the treatment of rheumatoid arthritis (RA), multiple sclerosis (MS), dry age-related macular degeneration (AMD) and fibromyalgia.




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