Seeking Alpha.Bionomics Finds A Second Bow To Its Anti anxiety...

Seeking Alpha.

Bionomics Finds A Second Bow To Its Anti anxiety Drug BNC210
May 10, 2021 2:03 PM ET Bionomics Limited (BNOEF) 4 Likes

Summary

• Solid formulation of BNC210 better and faster administration than liquid formulation.
• Bionomics PTSD Phase 2b trial will start soon with a tablet formulation.
• BNC210 has previously shown benefit for Social Anxiety Disorder, but the speed of effect was not consistent with acute treatment. New tablet formulation enables acute treatment.
• Phase 2 trial being scoped out for use of BNC210 for acute treatment of Social Anxiety Disorder.
• Discussion about the synergy between Bionomics BNC210 and EmpathBio EMP-01 for PTSD treatment.

Photo by LanaStock/iStock via Getty Images

Bionomics (OTCQB:BNOEF) (ASX:BNO) is a company with a long history that has been pretty turbulent of recent times. However, notwithstanding that the world has been off balance with COVID-19, Bionomics has got its mojo back and is now in good shape to make investors happy with its BNC210 drug for treatment of PTSD (Post-Traumatic Stress Disorder) and other anxiety-related diseases. Here I update new developments on capital raising, clinical trial progress and a new application for BNC210. Bionomics remains largely a single target company, but BNC210 may have application in anxiety disorders beyond PTSD. This represents an interesting opportunity in a valuable and poorly treated clinical area.

Oral tablet formulation trial succeeds

Shortly after my previous article was published, Bionomics reported good results for its solid formulation trial for its PTSD drug BNC210. This trial was to explore whether a new solid formulation resolved the variability in dose levels achieved with a liquid formulation that had special food intake requirements for delivery. The solid delivery with a 900 mg twice daily tablet resolved the variable dosing and has the additional benefit of achieving rapid blood levels of an effective dose. The goal was to achieve 12 hourly dose above 25 mg.hr/L. The readout was 33-57 mg.hr/L which is well above the effective dose.

Rapid effective dose from tablet formulation suggests effective acute treatment for Societal Anxiety Disorder

Societal Anxiety Disorder (SAD) is experienced by 17 million US adults and is a significant burden. The tablet formulation of BNC210 is rapidly absorbed, reaching maximal blood concentrations within an hour. This suggests that acute BNC210 treatment for SAD might be effective, allowing sufferers to medicate in anticipation (eg anxiety-provoking situations) of SAD occurrence or treat it quickly. The plan is to design a Phase 2 trial to test this hypothesis within the next quarter and provide a timeline for this activity.

BNC210 Phase 2b trial being finalised

With a successful outcome of the tablet treatment now clear, plans for a 12 week Phase 2b PTSD trial with 900mg twice daily dosing are now proceeding and manufacture, testing, packaging and labelling of the tablet formulation is well advanced. US Contract Research Organisation, Premier Research, which has experience of PTSD trials, will manage the Phase 2b trial. This company conducted the previous Bionomics BNC210 trial. The company has relationships with key PTSD groups. Clinical trial site identification is advanced and site selection underway. The trial protocol with be submitted to the FDA soon, with a view to trial start mid-2021.

Combining BNC210 with psychoactive MDMA derivative?

There has been considerable interest in recent use of psychoactive MDMA (Ecstasy) in combination with psychotherapy to treat PTSD. Bionomics recent capital raising brought into the company a group of shareholders, including billionaire Peter Thiel. These investors are interested in this novel treatment for PSTD, which is currently in Phase 3 trials.

The point about MDMA use for treating PTSD is that it is an adjunct to psychotherapy. MDMA alone is not a treatment for PTSD and its use requires commitment by both the patient with PTSD as well as a psychotherapist. PTSD results from exposure to a trauma leading to emotional memories that cause high anxiety. It is not surprising that those exposed to trauma (eg military personnel, police, firemen, rape victims etc) are susceptible to PTSD as the traumatic event brings flashbacks that the person suffering from PSTD struggles to cope with. People with PTSD can experience trauma even when the secondary event they experience is benign (e.g. loud noise in a civilian environment can bring the same response as a soldier experienced on the battlefield).

Treatments for PTSD involve either antidepressants, which work poorly and have significant side effects, or psychotherapy. BNC210 is an antidepressant that seems to have a potent effect on alleviating PTSD (and other disorders) without harmful side effects, which explains the interest in Bionomics. Psychotherapy can be effective, but it requires commitment and a skilled psychotherapist. Psychotherapy involves disconnecting a person from the traumatic memory and its impact on their wellbeing. The theory around use of MDMA is that its use may help the psychotherapist to speed repair of the PTSD effects. There is now significant data to suggest that MDMA can help a psychotherapist to treat PTSD. There is no suggestion that MDMA itself can cure PTSD. And MDMA has the risk of addiction and negative results from its use.

German company EmpathBio Inc (a wholly owned subsidiary of ATAI Life Sciences) is pioneering MDMA derivatives that have clinical effect while avoiding undesirable side effects. ATAI Life Sciences is backed by billionaire investor Peter Thiel, who is also a recent investor in Bionomics. Having raised $360 million, ATAI Life Sciences is preparing for a NASDAQ listing.

EmpathBio has joined with Bionomics to explore the possibility that its MDMA derivative EMP-01 in combination with BNC210 might improve treatment for PTSD, based on different mechanisms of action of these two compounds.

At this stage the MOU between EmpathBio and Bionomics is exploratory to see if there might be the possibility of combining the two drugs to advance treatment of PTSD. Most probably the philosophy behind the exploratory discussions is to see whether BNC210 in combination with EMP-01 might decrease the requirement for skilled psychotherapy in treating PTSD and simplify the commitment of the PTSD patient.

Cash position

Australian biotech companies are notoriously cash poor and this often leads to successive capital raising at an ever diminishing share price. This is a reason for scepticism about biotech on the ASX. In recent years Bionomics faced this problem as it sought to raise the cash to conduct a Phase 2 trial on its BNC210 drug for PTSD. I've discussed the traumas in a previous article, which suggested a change in fortunes for the company with a $A16 million capital raise in February 2021. This has been followed by further raisings in April of $20.4 million in a 1 for 6 Entitlement Share Offer to existing investors (which was oversubscribed) and also another $A2.5 million placement to certain shareholders. Overall this raised a further $A22.9 million. The above raisings were all priced at $A0.145/share, which was a 20% discount in the February raising. The share price has since risen to $A0.23 on the ASX ($0.19 on OTCQB).

The cash position of Bionomics was $A20.34 million as of March 31, 2021. Added to this is a further $A22.9 million from the Entitlement Offer plus further placement, meaning that company currently has ~$A40 million cash, which is sufficient to complete the Phase 2b PSTD trial.

Conclusion

Investing has many facets. One is seeking outstanding rewards from early stage biotech companies that pioneer treatments for major diseases that do not have effective treatments. I've recently covered Bionomics as a company that is well positioned to benefit from a long term and very focused treatment for diseases involving anxiety and depression. Its BNC210 is a drug with a novel mode of action that has a strong indication of powerful effect on treating PTSD. Since my February article, the Bionomics story has been strengthened by completion of a series of capital raisings, clarity on tablet dosing and discussions concerning potential synergism between Bionomics BNC210 and MDMA treatment. The key Phase 2b trial for PTSD is on target for mid-year commencement and plans are underway for a second Phase 2 trial involving SAD. With the share price supported, it has been a good start to 2021. I am a long term investor and I think this company is worth considering if you seek an early, risky biotech investment with considerable near term upside. Of course substantial returns often have complexity and in this case it may mean investment outside of your usual comfort zone in US markets.

I am not a financial advisor but I have long experience of biotech innovation and investment.

This article was written by

Keith Williams

5.57K Followers

Keith began his career as a research scientist (developmental biology, biochemistry, molecular biology) at...