Cogstate (CGS: $1.46) has seen its share price oscillate in recent weeks, in sync with the share prices of Eisai Co and Biogen. All three companies will be impacted by the results of the Phase III study with the Alzheimer's disease drug candidate, lecanemab, which is jointly owned by Eisai and Biogen and in clinical development by Eisai. Topline results are due at the end of this month.
For Cogstate, positive results from the Phase III lecanemab study will underpin continued optimism in Alzheimer's disease drug development, which is a major part of Cogstate's core business. It would also build strong demand for its cognitive test in the community (and through GPs) which is being commercialised globally by Eisai in this market.
A negative result would not have an immediate impact on the Cogstate business, with the company already having secured a large backlog of work (US$139 million) with those trials expected to continue regardless of results of any Phase III Alzheimer's disease trials. However, a negative result may pause the initiation of some new contracts whilst other companies gain a better understanding of any negative trial outcome.
Eisai has made a considerable investment in lecanemab. Its first study was a Phase I trial in 80 patients where a dose-dependent response on beta amyloid levels was observed.
The second study (Phase II) enrolled 856 patients with mild disease or prodromal disease and treated with five different doses for 18 months. There was a dose-dependent response. The highest dose achieved a 93% reduction in brain amyloid. Cognitive decline was slowed by 47% and 30% using the ADAS-Cog and ADCOMS measures respectively over placebo. Brain swelling (ARIA) was measured in less than 15% of patients most at risk (those who carry the ApoE4 gene) although most were asymptomatic (This compares to 41% ARIA incidence with Aduhelm).
Eisai (and Biogen) is currently conducting a Phase III study with lecanemab, with 1,794 patients enrolled by March last year. Last year Eisai also started a trial to assess subcutaneous injection of the drug candidate, which could potentially allow patients to self administer. Lecanemab is being trialled in a combination study with an anti-tau therapy. A 1,400-patient study is also underway with lecanemab in patients who are cognitive normal but have elevated beta amyloid levels. They will be treated for four years at half the highest dose (10mg/kg per month). Changes in cognition and tau levels will be endpoints. An open label extension study for 250 patients in the Phase II trial completed is also underway following patients for two years on lecanemab therapy.
Some important learnings have been made in Alzheimer's disease drug development over the last two decades. The three most important have been: (a) the need to confirm build-up of beta amyloid when selecting patients for trials; (b) ensuring treatment for a minimum 18 months to show divergence from the placebo arm, and (c) treatment of patients with early-stage disease. Going forward understanding the impact of tau protein build up in the brain on efficacy in patients receiving beta amyloid therapies may be a consideration.
Other Phase III Alzheimer's disease trials due to read out in the next nine months include gantenerumab from Roche (a low expectation of positive results) and donanemab from Eli Lilly (positive results expected).
Cogstate is capitalised at $257 million with US$28.7 million in cash at the end of June.
Bioshares recommendation: Buy
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