Adalta (IAD: $0.018) is developing the next generation of therapeutic antibodies. These compounds are human protein drug candidates based on the unique structure of shark antibodies. This design combines the features of small molecule drugs (that can access binding sites conventionally difficult to access) and antibodies (which are characterized by the ability for highly specific binding).
The company's lead program has had an indirect path to its present status, which in the next eight months should lead to an anticipated licensing deal, according to CEO Tim Oldham.
Oldham said the company has a list of 21 companies which are closely following the company's lead drug candidate, AD214. Around seven of those companies are said to be showing a strong interest in potentially licensing the compound.
The first indication being pursued is the treatment of idiopathic pulmonary fibrosis, for which there is currently no effective treatment despite a very strong medical need.
However, the challenge with developing a drug to treat fibrosis in the lungs is that it requires long studies with no clear biomarkers that can act as actual or surrogate short-term endpoints. So, to conduct a licensing deal in this space, it means the data package (preclinical and Phase I data) needs to be extensive and complete.
Final Data Set Expected in February
Adalta is awaiting two final data sets which once complete, and if positive, are expected to place the company in a position to negotiate a licensing deal. The first information set the company is preparing is whether there is a lasting immune response to AD214 after three months. If the lasting immune response is high, it could negate the effectiveness of AD214 as the chronic disease therapy.
Subjects are dosed 10mg/kg AD214 at zero, two and four weeks, and then once again at 16 weeks, to measure whether prior treatment negatively impacts the efficacy of the drug.
The second data set the company is awaiting contains results relevant to the safety of multiple injections of the 10mg/kg dose. The company believes that to meaningfully inhibit fibrosis progression, AD214 needs to occupy more than 50% of the CXCR4 receptor on an ongoing basis, with 80% ongoing occupancy providing maximum efficacy.
Adalta has modeled that a 10mg/kg dose should achieve that goal when delivered every two weeks intravenously. The Phase I study is due to be completed around the end of this year with results expected to be released in February, according to Oldham.
Whilst Adalta has been working its way through its Phase I program, it has also been investigating whether AD214 can be delivered subcutaneously (i.e. at home). Non-clinical studies have shown that the target 50% receptor occupancy could be reached with a weekly subcutaneous dose of AD214 at 3mg/kg.
Earlier this month Adalta, conducted a private placement to raise just $1.65 million which Oldham expects will be sufficient to get the company through to an expected forthcoming licensing deal.
Adalta had $3.6 million in cash at the end of September. It is capitalized at $9 million.
Bioshares recommendation: Speculative Buy Class B
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