Bearish Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) Holds No Water: Here's Why

Adam Feuerstein of The Street put out a hit piece on Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP) on October 24, detailing the company's lead (and only) asset Resunab. The gist of the piece was this: Feuerstein has a secret source in the biotech space that has deduced from old trial data that Resunab doesn't work, and that as a result, the company is going to blow up when it puts out data from its ongoing trials before the close of the year.Here's the article.We've seen him get it wrong many times before (Celator Pharmaceuticals Inc (NASDAQ:CPXX) springs to mind immediately), but markets seem to have taken the opinions of his anonymous source as gospel and – as a direct result – the company is down close to 20%, with sentiment suggesting further weakness near term.In a nutshell: we think Feuerstein (or his source, whichever) is wrong in his assumption and conclusion. The evidence cited as being indicative of Resunab's inability to perform is very weak, and while we cannot guarantee the drug's success come data release, there's as good a chance of it hitting on its endpoints today as there was at the close of last week. In turn, we think Feuerstein has created a nice discount entry point ahead of Corbus' next binary event.Here's what's behind our thinking.The article first highlights the inability of CB2 agonists to improve on current SOCs (ibuprofen is the example given) in pain management as indicative of its failure in immunomodulary indications (such as those which Resunab is targeting). This is not only immaterial, it's an expected outcome. CB2 receptors exist primarily in the periphery system (the immune system, essentially). CB1 receptors exist primarily in the central nervous system. A pain management cannabinoid needs to work on the CNS, and by proxy, needs to be a CB1 agonist, not a CB2. Resunab has poor CNS availability, and this is one of the things that makes it so promising as an inflammatory target – it's not psychoactive, as a CB1 agonist might be.Feuerstein then goes on to discuss how he has dug out Corbus' trial data:

Dig into the published papers, like I did, and you'll find Corbus' Resunab data are weak and inconsistent. The data culled from cells of scleroderma patients show no impact on any measure of fibrosis at the doses currently being tested in phase II clinical trials.

We've dug out the data (note: it didn’t take much digging, it's in pretty much every company presentation since 2014) and what he is saying is outright false.The trial is testing the drug at two doses (with a few different dose schedules), 5µM and 20µM. The two charts below show what various doses of Resunab did in scleroderma patients (bear in mind that increased TGF-beta and collagen is correlative with increased severity of the condition):sourceSo, at 5µM, TGF-beta levels reduced to just above normal. At 10µM, this level reduced to below normal. The same trend is illustrated with collagen levels.The second image illustrates date from a 2012 trial, which saw scientists introduce a compound called Bleomycin into mice. Bleomycin indices skin thickening and fibrosis. The chart shows what happened to skin thickness (a major symptom of scleroderma) after Bleomycin introduction, and then after Resunab introduction:sourceThe chart shows that Resunab reduced skin thickness to levels just above that of control. The timeframe here was four weeks.From where Feuerstein is drawing his notion that Corbus doesn't have any solid data to back up its phase II hypothesis, animal, patient or otherwise, we don't know. The data exists, and readers can run through it themselves here to confirm the accuracy of what we are saying. The same source highlights similar results in cystic fibrosis.As for his statement that it's not clear what the CB2 receptor does, if anything, that's nonsense.Here are some links dating back a decade or more studying the actions and effect of the CB2 receptor and its activation in a host of different indications, inflammatory or otherwise.Here.Here.Another.Another.One more.Bottom line here is Feuerstein's thesis holds no water. The facts he uses to put his point across are weak, if not outright wrong, and Corbus remains on track for an upside catalyst when data hits later this year.We're watching the company closely for its release, and we'll update our readers as to our interpretation when the numbers hit. Subscribe below and we'll keep you in the loop!Disclosure: We have no position in CRBP and have not been compensated for this article.