x min read

Keep An Eye On Rexahn Pharmaceuticals Inc (NYSEMKT:RNN) This Year

Keep An Eye On Rexahn Pharmaceuticals Inc (NYSEMKT:RNN) This Year
Written by
Chris Sandburg
Published on
March 13, 2017
Copy URL
Share on LinkedIn
Share on Reddit
Share on Twitter/X
Share on Facebook
InsidrFinancial

Rexahn Pharmaceuticals, Inc. (NYSEMKT:RNN) ran up towards the end of last week on basically no news, and is running again early session in the US on Monday. March to date, the company is up more than 75%. This company is gaining speculative attention at a rapid rate, but it's not releasing any news. So why is it running? Because the next couple of quarters could be game changers for Rexahn, and markets are loading up in anticipation of such.Here's what to look out for.This company is a biotech that we've covered in the past here at Insider Financial, and one that we tagged back in October last year as being one to keep an eye on. It's an oncology player, and its lead asset is a drug called RX-3117. We covered the science in quite a lot of detail last time, but by way of a brief overview of how 3117 works, it's very similar to an already approved drug called gemcitabine (a widely used chemotherapy agent), which works by replacing one of the functional nucleic acids in the DNA of cancer cells with a faulty version. The faulty version causes apoptosis, killing the cancer cells and – by proxy – stopping their spread. There's a problem with gemcitabine, however, and it that the enzyme that activates it (an enzyme called DCK) isn’t expressed solely by cancer cells – it's also expressed by healthy cells. This means the drug is highly toxic (nothing new here with cancer agents) and that it can only be administered in relatively low doses. 3117 is activated by a different enzyme, an enzyme called Uridine Cytidine Kinase (UCK). UCK is expressed by a large number of cancer cells, but only a small amount of healthy cells. As such, 3117 can be administered in far higher doses without being as toxic.So where does all this fit into the company's near term prospects?We got an update at the end of January that basically said the drug works, and works pretty well. It's in a phase II study right now that is broken in to two parts (a phase I and the current phase II), and the progression of the trial from 1 to 2 required a degree of efficacy, so that 3117 is now in part 2 tells us that there's efficacy there.These are patients that have pancreatic cancer that have failed three or more previous therapies. Under current care regimen, they have no options left, and SOC is basically making them as comfortable as possible before they die. It's a big unmet need, and there's a real chance that the company might be able to pick up an accelerated approval pathway for the drug if the data from the ongoing phase IIa study proves positive. With such a pathway in place, Rexahn likely won't have to complete a phase III before gaining approval (the FDA will green light the drug and request a post approval monitoring program), and that's why this trial is so important. Which brings us to the catalyst – the company is going to put out an initial data read out as early as late second quarter this year; third quarter at the outside. By start summer, then, shareholders could be looking at a clear, and very short, path to approval.And there's more to back up any upside that this data brings about. The drug is also under investigation as a bladder cancer target, and data from a phase Ib/IIa study is set to read out around the same time as the pancreatic cancer study does.Then there's a breast cancer study of a different asset, one called Supinoxin, that’s going to read out from a phase IIa in metastatic triple negative breast cancer during the second half of this year. That's three large catalysts between now and the end of the year, each of which has the potential to bring about high double digit percentage point gains, if they read out as positive.Cash stands at a little over $20 million, giving Rexahn a runway through early 2018, meaning dilution shouldn’t be an issue before these catalysts hit press.As ever, there's risk, and in this case it's rooted in the data. The numbers demonstrated efficacy for 3117, but they weren’t fantastic (high enough to get approval, if they can translate to a wider study, but not amazing) and there's a chance that they will dilute (we're talking data significance here, not the other type of dilution) as the patient population expands.With that noted, as a catalyst driven biotech play, this one is very much one to watch.We will be updating our subscribers as soon as we know more. For the latest updates on RNN, sign up below!Disclosure: We have no position in RNN and have not been compensated for this article.

Discover Hidden Gems

Don't miss the next big opportunity. Subscribe for timely alerts on potential market movers.