Neuren Pharmaceuticals Limited

ASX:NEU

Neuren Pharmaceuticals Limited

ASX:NEU
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$12.36 (-0.6%)
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#16
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Pinned straw:
Remorhaz
Added 4 months ago

FWIW JP Morgan (Overweight with 12m PT $26.70 - so take this with the requisite grains of salt) have released an updated note with the following summary highlights ...

Thoughts ahead of the Angelman phase 2 results in 3Q24

Expectations are high ahead of the results from the phase 2 trial of NNZ-2591 for Angelman syndrome (AS) due early this quarter. A positive result will support the belief that NNZ-2591 is a “multi-indication platform”. In this note, we focus on what to look for when the phase 2 results are released, along with an assessment of the competitive landscape. AS is an attractive opportunity as there are currently no approved therapies but the competitive challenge is greater than for Phelan-McDermid and Pitt Hopkins syndrome where NNZ-2591 has the potential to be the first therapy to market. Beyond the phase 2 results for AS, Neuren remains well positioned with catalysts ahead including the quarterly result and an FDA meeting. We reiterate our Overweight rating

Focus on CGI-I and CIC endpoints for Angelman. These two efficacy endpoints will give a sense to how much NNZ-2591 reduces disease severity in AS patients. Neuren hopes to deliver scores below 4 and ideally less than 3. While the positive results from Neurens previous trials of NNZ-2591 in Phelan-McDermid and Pitt Hopkins syndrome were encouraging, we caution the read across to the Angelman trial is limited given its different etiology

Neuren’s Angelman trial has been completed with results due this quarter. The last patient enrolled for the AS trial was about two weeks after the last patient enrolled for the Pitt Hopkins trial, which reported results last May. However, we expect the collection of results and analysis of data to take longer with AS because the clinical trial sites were in Australia which have less experience compared to US sites

Several competitor trials for Angelman. AS presents a sizeable opportunity with no current therapies. We are aware there are other therapies in trial which are all at a similar stage to NNZ-2591, including Roche’s GABA-modulator alogabat and antisense-oligonucleotide candidates Ultragenyx’s GTX-102 and Ionis Pharmaceuticals’ ION582. These trials are also early stage but Ultragenyx indicated it plans to initiate a phase 3 trial by the end of 2024

FDA meeting for NNZ-2591 in Phelan-McDermid plus new indications. Also this quarter will be Neuren’s post phase 2 Phelan-McDermid meeting with the FDA. We expect the company to make an announcement once the minutes from this meeting are published. We are hopeful this will support the move to a company funded phase 3 trial starting in early CY25. We also expect the company to announce its plans for NNZ-2591 in the treatment of other rare neurodevelopmental diseases

Retain Overweight. Daybue sales in the June quarter (to be reported by Acadia Pharmaceuticals in early August) are difficult to predict after the volatility in the previous quarters (strong Dec but weak March) with this uncertainty weighing on share price. We are comfortable sales will lift over December but would see any disappointment as an opportunity ahead of the NNZ-2591 results


DISC: Held in RL & SM
mikebrisy
Added 4 months ago

@Remorhaz thanks for sharing. $ACAD report on 31st July, so I'll join their call early am on 1 August. (Dates might move around a day or two)

I am very interested in Q2 for DAYBUE and, as I published after Q1, I was rather troubled by the Q1 result (and reduced weight in $NEU accordingly). I've built a model which simulates the effect of the persistency curve (as a function of time) and I'll be history-matching the Q2 result to my model, which will help me form a better view on forecast sales. (I'll of course share my findings later on in the morning when I climb out of my spreadsheet saddle!)

If it looks bearish on DAYBUE, then I'll have to sharpen my view on how much value (and risk) I am prepared to place on NNZ-2591. While the latter looks very good so far, with mutliple promising indications, I tend not to place a lot of money at the Phase-2 level, as that's getting outside my circle of competence and risk-reward appetite. (Other $NEU bulls here take a different approach ... not naming anyone in particular, eh, @Nnyck777?)

No doubt, $NEU will continue to be a very, very "interesting" investment!

Disc: Held in RL and SM

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Nnyck777
Added 4 months ago

Hi team,

Apologies for the delayed response @mikebrisy. As far as NEU goes I have made no secret of the fact I am a super bull here. Has this changed- no. It is my largest SMSF position and my second largest personal portfolio position.

The recent Lilac extension study leans in to the benefits of being on Daybue for longer. A recent update from Mellan (I am sure many follow this story) has provided continued optimism that side effects can be managed. There is suggestion patients make take a break but do retry Daybue as they are hearing so many gains from others. I am optimistic Daybue will remain in guidance at the August 6th update with Acadia.

However my conviction for my investment in NEU now remains largely based on NNZ-2591. Just quietly waiting for the Angelman results like everyone else. While a positive result is unlikely to knock the lights out share price wise, I think it will be the final derisking signal to the market. Angelman has competition so this condition may not be the priority to take to market compared to Phelan McDermid. If positive it would be 3/3 and arguably add significant value to a final buyout price for the business.

FDA meeting this qrt will be a major catalyst if they reduce the burden on patients in trials as NEU has really established that NNZ2591 is a safe drug. This could mean faster starts for phase 3 trials and pave the way for easier phase two structures for new conditions. That is the point I think a buyout will be triggered. I am still bullish that NEU can achieve more than Reata given the multiple applications on the horizon. Between US $10billion and $14billion I think can be achieved. Even though with modeling that number seems minuscule versus the potential number of applications and larger market sizes than Rett. I will continue to stay fully invested and wait for the potential AU $116 - $163 a share buyout.:)

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mikebrisy
Added 4 months ago

@Nnyck777 fair enough, and you have been consistently right on this.

Thanks for the heads up that $ACAD call will be 6th Aug ET/ 7th AEST. I see that announcement just went out.

The 2Q number is critical for me, as it indicates whether we are back on an S-curve, rather than something else.

You refer to a recent Lilac extension. Is that post-Q1? If so, I’ll have a look.

My risk appetite is different to yours, as I am relying on the growing base of DAYBUE sales, and I don’t invest solely in Phase 2.

That said, you are right in that looking across the 3 indications for NNz-2591, should there be positive results for Angelman (irrespective of whether that condition is commercialised), fundamentally changes the risk profile.

My risk averse nature had me take one-third off the table in Q1, but if DAYBUE looks good at Q2, I’d definitely consider putting it back on.

I do find it hard to value the NNZ-2591 upside, huge though it is.

16
Nnyck777
Added 4 months ago

Absolutely agreed valuing this is extremely difficult. Really only educated guessing and ranges vary so widely. I respect your approach for going for the known knowns with Daybue.

Interesting to see todays announcement re: NEU attending US investment conferences August / September. Perhaps NEU will be fielding their first offers. We can only speculate:)

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