HIGHLIGHTS FROM THE NEUROTECH INDUSTRY CONFERENCE 2006

The Neurotech Industry Investing and Business Conference organized and hosted by NeuroInsights on May 18th showcased scientists, executives, and investors analyzing critical factors driving the development of new drugs, devices and diagnostics for the brain and nervous system. 

The Memory Market session featured companies targeting Alzheimer’s disease (AD) and cognitive impairment.  According to Rodney Pearlman, PhD, President and CEO of Saegis, a company developing therapeutics for cognitive dysfunction, “There are many specific challenges that must be overcome in order to demonstrate efficacy of treatments for memory disorders, including flawed animal models that do not translate well to the human condition, poor understanding of disease etiology and drug mechanism of action, lack of quantitative and robust efficacy measures, and the huge expense of conducting clinical trials.”

Acumen Pharmaceuticals is pursuing a disease-modifying approach to treat AD, targeting amyloid-derived diffusible ligands (ADDLs), which are soluble oligomer assemblies of amyloid beta 1-42 protein. “The company is interested in partnering with large pharma to advance its several leads,” stated CEO David Summa.

Ceregene also is working to rescue dying neurons in neurodegenerative disease, but instead of targeting beta amyloid the company is delivering growth factors using gene therapy.  CEO Jeffrey Ostrove, PhD, provided updates on Ceregene’s product development including CER-110 (AAV-NGF) in Phase I for Alzheimer’s, CER-120 (AAV-Neurturin) in Phase I for the treatment of Parkinson’s disease, and CER-130 (IGF-1) for the treatment of ALS.

Targacept (TRGT) CEO, J. Donald deBethizy, reported an impressive list of recent accomplishments, including an initial public offering raising $45 million, a lucrative development and commercialization agreement with Astra Zeneca (AZN) for its lead product candidate, TC-1734, a nicotinic  acetylcholine modulator for various types of cognitive impairment; successful Phase IIb results for TC-1734 in age-associated memory impairment; and a rich pipeline of compounds addressing other large CNS markets.

The Neuropsychiatry and Specialty Pharmaceuticals session highlighted various business strategies for acquiring and marketing new products. Jazz Pharmaceuticals has been on a roll since its inception, with three new products, one recent acquisition, and $345 million in funding. Products include Xyrem (sodium oxybate), a drug for patients with narcolepsy who suffer from excessive daytime sleepiness, which recently showed positive results in a Phase II trial of patients suffering from fibromyalgia. Matthew Fust, Senior Vice President and Chief Financial Officer, said that Jazz is actively looking to expand its internal portfolio of products through in-licensing, acquisition and partnering.

Amarin (AMRN) is currently conducting large Phase III clinical trials of Miraxion in the US and Europe to treat Huntington’s disease. Miraxion also recently was studied in a Phase II trial of depressed patients who failed to respond to current treatments, both as an adjunctive therapy and a monotherapy. “As a result of encouraging clinical trial results, Amarin intends to further evaluate the clinical benefits of Miraxion in depression and will seek a marketing partner to accelerate this program,” stated Rick Stewart, CEO of Amarin. Miraxion is synthesized from eicosapentaenoic acid, an omega-3 fatty acid, which is believed to stabilize cell membranes and mitochondrial integrity of stressed neurons, thereby preventing or slowing progression of neuronal death. 

Predix Pharmaceuticals’ President and CEO, Michael Kauffman, MD, PhD, announced the recent merger with EPIX Pharmaceuticals and updates on several of their product candidates including PRX-00023, a novel long-acting 5-HT1A agonist, which has completed enrollment for a pivotal Phase III clinical trial in patients with generalized anxiety disorder (GAD) (see story, page 7).

BrainCells, Inc. is targeting therapeutic neurogenesis which has been shown preclinically to play a role in the efficacy of current antidepressants like Prozac. According to CEO Jim Schoeneck, “The company is deploying its neurogenesis platform for profiling and selection of drug candidates. We believe that the platform represents a major improvement in the predictive power of pre-clinical models for CNS disorders, in particular depression and mood disorders, which will facilitate a paradigm shift in CNS drug discovery.” 

The Neuroregeneration session featured companies using a variety of strategies to replace or regenerate lost neurons. NeuroNova is developing drugs to induce therapeutic neurogenesis for degenerative disease. The three leading drug candidates are sNN0029 for an undisclosed orphan drug indication, and sNN0031 and sNN0465 for Parkinson’s disease. “Clinical trials are planned for 2006.” said Anders Haegerstrand, MD, PhD, CSO of NeuroNova.

Sound Pharmaceuticals is developing medications to prevent and treat hearing loss, a disorder that affects 30 to 40 million individuals in the US. The company is focusing on the role of p27Kip1, an enzyme shown to regulate cellular proliferation by interrupting the cell cycle. This research demonstrates for the first time that inner ear hair cell regeneration is possible in mammals. Jonathan Kil, MD, President and CEO of Sound, stated that the company “is currently optimizing its lead compound for further testing and expects to develop its patented formulations into oral drugs that will provide protection and regeneration.

StemCells, Inc. (STEM) has developed human CNS stem cells (HuCNS-SC) for transplantation therapy, using a proven methodology to isolate rare stem and progenitor cells from human fetal tissue. The stem-cell-in-a-bottle concept is a major advance in productizing stem cell treatments for clinical applications. “A sequence of steps must be accomplished to make stem cells work: isolate the cells; create all 3 CNS cell types (neurons, astrocytes, and oligodendrocytes); deliver the cells to the brain; avoid adverse events; and promote normal biological function,” stated Martin McGlynn, President and CEO of StemCells.  StemCells received FDA clearance for a Phase I trial to treat Batten disease, and the company is initiating enrollment of children with this rare, fatal, genetic lysosomal storage disease.

StemCell Sciences is focused on technologies to grow, differentiate, select, and purify embryonic stem cells. The company’s intellectual property includes technologies to permit the genetic selection of unlimited quantities of highly purified stem cells and their differentiated progeny for use in genetic, pharmacological, and toxicological screens. These technologies can also be used to provide pure populations of appropriate cell types for transplantation therapy. “Our proprietary technologies, commercialization programs and collaborative partnerships with scientific pioneers continue to offer the most realistic route to delivering medical benefits for incurable diseases,” said Peter Mountford, PhD, President and CEO of StemCell Sciences.

The Neurodevice session provided refreshing perspectives on electrical, rather than chemical or cellular methods for treating brain and nervous system disorders. Lothar Krinke, PhD, Senior Director of Business Development at Medtronic (MDT) emphasized that Medtronic is striving to expand the clinical indications for neurostimulation. A pivotal trial of deep brain stimulation is currently underway to treat refractory major depressive disorder. Trials are also underway in epilepsy to reduce seizures and in gastric electrical stimulation for obesity management. Additionally, Medtronic is ideally positioned to collaborate with drug companies to advance drug-device combinations using its targeted pump to deliver drugs to the CNS.

Leptos Biomedical is developing a proprietary neuromodulation therapy for chronic obesity. The treatment involves electrical activation of a specific nerve in the autonomic nervous system, delivered via a pacemaker-type device. Leptos has received clearance from the FDA to conduct a limited feasibility investigation under an Investigational Device Exemption (IDE). John Dobak, Founder of Leptos, emphasized the advantages of the company’s technology, “We believe that this therapy may offer an effective minimally invasive, reversible surgical option for people suffering from chronic obesity.

Neuronetics is developing Transcranial Magnetic Stimulation (TMS) delivered non-invasively from outside the head to the area directly above the left prefrontal cortex. This technology emits very short pulses of magnetic energy to access internal brain structures and stimulate nerve cells in the brain. This process delivers focal stimulation to targeted areas, while minimizing stimulation of brain tissue not involved in mood regulation. Bruce Shook, President and CEO of Neuronetics, reported that “Neuronetics is developing TMS, with the lead indication in depression but with other targets in neurology and psychiatry in the future.” 

Cyberkinetics Neurotechnology Systems (CYKN.OB) which recently announced the acquisition of Andara highlighted results from the Andara Oscillating Field Stimulator (OFS) PLUS System, which can induce nerve regeneration and functional recovery after chronic spinal cord injury in preclinical models. Now in a Phase Ib clinical trial, the Andara OFS Device is designed to stimulate regrowth of the neural fibers surrounding the spinal cord and across the injury. President and CEO Timothy Surgenor also underscored the promising therapeutic applications of Cyberkinetics’ brain-computer interface for improving the functioning of spinal cord injury and ALS patients.

Conference panelists, presenters, and participants alike were clearly favorably disposed toward neurotechnology, in spite of the unique challenges confronting CNS product development.  Representatives from both venture capital and big pharma reported being open to funding neurotechnology, especially when a company’s products have already demonstrated proof-of-concept and have a clear commercialization path. High-risk is mitigated by the potential for significant reward. After all, today’s risks may be tomorrow’s breakthroughs.