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Anavex Life Sciences Corp (NASDAQ:AVXL) Just Presented Yet More Favorable Data

Anavex Life Sciences Corp (NASDAQ:AVXL) Just Presented Yet More Favorable Data
Written by
Chris Sandburg
Published on
April 4, 2017
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Anavex Life Sciences Corp. (NASDAQ:AVXL) is one of the companies that we have repeatedly pitched as having a bright future, against a backdrop of our competitors over at The Street and Fool repeatedly painting the company as a sure thing short. As things stand, our expectations have proven valid. The company is up around 45% year to date.That’s a nice run, but as the abovementioned continue to forecast Anavex's decline, we'll say it again – this one's got plenty of long term run potential.The latest news out of Anavex details some fresh evidence supporting the mechanism of action (MOA) that underpins the company's lead program, and yet again, highlights said program's potentially game changing impact in the CNS and neurodegenerative disease space.We'll take a look at that specifically in a moment, but before we do, let's re-outline our thesis for the stock.In short, Anavex is taking an approach to a neurodegenerative conditions, the lead of which right now is Alzheimer's, that if proven effective, will essentially render all other treatment approaches that have come before it (and the big pharma has spent billions developing) moot. It's rooted in what's called the sigma-1 receptor, which the company believes (and for which it’s building a strong body evidence in support of the fact that it) can serve as a sort of quality control switch that will return homeostasis to damaged brain and CNS cells.The company is pushing forward in Alzheimer's with its 273 asset, but there's also evidence that the same MOA can have an impact on a whole spectrum of other conditions, including epilepsy, Rett's, depression, memory loss, dementia. That the sigma-1 receptor could play a key role in the development of all these sorts of conditions is analogous to the suggestion that all of these conditions have a common start point (the malfunction or reduced activation of sigma-1, for example) and then develop down different pathways. By going after this common start point, there's real credence to the suggestion that Anavex has hit on a golden ticket in the biotech space.The risk here is that the company is basically putting all its eggs in one basket. If it turns out that sigma-1 isn't the common denominator in these conditions, then Anavex's pipeline basically sinks.Countering that risk, however, is the increasingly large body of evidence that is pointing towards impact in all of the above mentioned conditions, and more. Drugs don't generally show potential in Alzheimer's, Parkinson's, epilepsy and depression at the same time. Anavex's does, and that's what makes it intriguing.And if it's about building a case for this intrigue, the latest announcement is well worth looking at.The company announced on Monday that it has presented some new MOA data related to the above discussed sigma-1 receptor at the AD/PD 2017 Meeting. This is one of the top dates on the neurodegenerative calendar, and the company basically just demonstrated that the targeting of sigma-1 with an asset called 3-71 can result in synaptogenesis, which is the forming of new connections (synapses) between neurons, without causing an abnormal increase in the number of astrocytes. Synaptogenesis is commonly believed to be impaired in patients with Alzheimer’s and Parkinson’s disease, so the ability of a drug to reverse this impairment suggests strong clinical benefit. At the same event, the company also demonstrated that its portfolio of development assets – 2-73, 3-71 and 1-41 – have protective effects of what are called mitochondrial enzyme complexes. These complexes make ATP, which is the energy unit that cells require to metabolize. Energy production impairment and mitochondrial dysfunction play a role in the pathogenesis of neurodegenerative disorders and neurodevelopmental diseases, or so current theory infers, so the ability to protect this process should translate to (again) clinical benefit.As we've said, there's risk here, and it's rooted in the potential for all this data proving misleading, and the drug not translating to a top line improvement in the conditions described. And it's a valid risk – as anyone who has lined up a position in favor of inferred clinical benefit in Alzheimer's in the past forty years will know too well.For those willing to shoulder the risk, however, there's massive potential rewards, if Anavex really has the golden ticket that early data suggests it might.We will be updating our subscribers as soon as we know more. For the latest updates on AVXL, sign up below!Disclosure: We have no position in AVXL and have not been compensated for this article.

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