Last year novel antibody company Adalta (1AD: $0.044) announced that it would be moving to develop an inhaled formulation of its lead drug candidate, AD-214. This followed preclinical studies that showed high accumulation of the compound in the liver, although no liver toxicity was observed in patients in the Phase I study.
However, it has decided to return to an intravenous delivered version of the compound, which was re-engineered in 2018 (from AD-114) to provide a longer half-life for less frequent administration.
There were three key reasons the company has decided to move back to developing the intravenous formulation of AD-214.
Over the last 18 months Adalta has developed an inhaled version of AD-214, however this could not be successfully tested in a mouse model of lung disease. In this time, data was published on the potential efficacy of AD-214 in kidney disease, for which an inhaled therapy would not be suitable. And the duration of receptor occupancy has been found to be longer than earlier expected, with a three day (71 hours) elimination half-life in the blood stream.
With the now longer than expected binding of the target, an intravenous version could be delivered to patients every one to two weeks. (Studies have shown that 90% target inhibition is sustained at the dose of 10mg/kg one week after injection.)
Adalta expects to move into a Phase II study in the first half of 2024 with the IV version. This will be either in lung fibrosis (IPF), kidney fibrosis or eye fibrosis, with more preclinical data expected in the latter two which may direct the clinical program. The end point in lung fibrosis is a slowing of lung function decline, however according to CEO Tim Oldham, the rate of decline across patients is not linear (and therefore harder to measure the benefit). Measuring the effect on renal function is more predictable and consistent believes Oldham.
The Phase II study will likely recruit between 40 - 60 patients. Manufacture of product is scheduled to be completed by the end of 2023. The commercialisation of the inhaled version of AD-214 will be available for potential partners to in-license.
Adalta is capitalised at $14 million with just $9 million in cash at the end of September including the R&D tax rebate received this quarter.
Bioshares recommendation: Speculative Buy Class B
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