AzurRx BioPharma, Inc. (NASDAQ: AZRX) has been earning a lot of attention lately. And, while many clinical-stage companies tend to get a few optimistic nods from investors and analysts, AZRX is proving and creating its value through a development program built upon strong fundamental and scientific underpinnings. And their focus on multiple multi-billion dollar markets doesn’t take away from the attention, either. One that is getting intensified focus is its trial showing potentially effective treatment against COVID-19 related GI-infections. Deservedly so.
In fact, AZRX is developing treatments to meet alarming data showing that the long-term effects of COVID-19 can remain in the GI tract for weeks, perhaps even years. Moreover, they may be one of the few companies positioned to battle the now dominant Delta variant, a Covid infection mutation surging worldwide. Notably, the HIH and CDC just funded another $3 billion to study the variant. And that’s potentially great news for AzurRx. Why?
Because AZRX’s Phase 2 RESERVOIR trial launched in April could put the company in a leadership position to meet the unmet demand. Moreover, this two-part, two-arm, placebo-controlled study examining the safety and efficacy of FW-1022, an oral micronized niclosamide tablet for COVID-19-related GI infections, is more than timely; it can be a lifesaver.
Thus, with billions in new funding being allocated toward promising COVID-19 treatments, including post-infection therapies, AZRX is well-positioned to apply for funding to accelerate the pace of its trials. And with AZRX well ahead of potential competitors in its targeted studies, those requests could be treated favorably.
And don’t underestimate the impact that the Delta variant presents. To those not familiar with the recent headlines, there is a surge in new infections happening in India and Europe. In fact, German Chancellor Angela Merkel has warned that Europe is on “thin ice” as the Delta variant of Covid spreads on the continent.
Being Timely Is An Understatement
Indeed, AZRX is timely with its trial. And with its drug candidate’s potential to help the hundreds of thousands of people worldwide suffering from post-COVID complications, it can also meet the needs of another potential global crisis. In fact, data supports that its treatment could extend to millions of patients, especially those already infected.
Although not widely reported, the after-effects of COVID-19 can be as harmful as the disease itself. AzurRx especially notes the growing number of people who experience “long haul” GI complications due to what many believe is the ability of the SARS-CoV-2 virus to hide in reservoirs within the GI tract. Notably, gastrointestinal infection symptoms, including severe diarrhea, vomiting, and abdominal pain, have been reported in roughly 18% of COVID-19 cases. Worse, another study indicates that viral RNA-positive stool samples are being reported in approximately 48% of all COVID-19 patients.
It continues downhill from there, with other studies showing that approximately 10% of patients infected with COVID have persistent symptoms months after their initial diagnosis and that over 60% of the long-haul/post-COVID patients have GI infection symptoms. Most notable there, AZRX is developing treatments for market opportunities that are likely here for the long term. Moreover, despite the progress made with vaccines, it’s expected that they won’t defeat the COVID pandemic. Instead, COVID-19 will likely become endemic. And if that’s the case, there is a substantial and unmet need to develop therapeutics that can help the world’s population deal with the effects of COVID-19 infections.
The excellent news on that front is that AZRX’s niclosamide therapeutic may emerge as a leading candidate to play a lasting role in treating patients. In fact, there is a growing body of evidence supporting the potential of niclosamide as a COVID-19 therapy. For example, niclosamide was already identified by the Institut Pasteur Korea as a potent inhibitor of SARS-CoV-2, the virus causing COVID-19, with potency 40X greater than remdesivir. In addition, a more recent study published in the journal Nature found that niclosamide could prevent long-term lung damage in COVID-19 patients.
Thus, AZRX is confident that its micronized oral niclosamide therapy can target SARS-CoV-2 directly in the gut and become an important addition to the therapeutics that may, unfortunately, be required by many who contract COVID-19. Keep in mind, too, there is currently no targeted treatment for COVID GI infections, and AZRX has the potential to be the first-to-market therapy targeting this indication.
Investors won’t need to wait long for results, either. Topline data is expected to be released during the first quarter of 2022. Interim updates could come as early as next month, however.
Still, with all eyes presently turning toward its RESERVOIR trial, AZRX has plenty more in its pipeline.
Targeting Multi-Billion Dollar Gastrointestinal Infections Markets
In fact, AzurRx is creating quite a buzz by developing a broad pipeline of targeted, non-systemic large and small molecule therapies to treat gastrointestinal (GI) and infectious diseases. Those are important multi-billion dollar markets. And more importantly, for AzurRx investors, the company is working to provide near-term shareholder value by focusing on short-term, lower-risk development pathways. More specifically, AZRX is advancing two assets targeting three indications, setting the stage for multiple near-term potential catalysts.
Better still, investors new to AZRX are on time to benefit from the release of interim positive topline results from its Phase 2 combination treatment targeting severe exocrine pancreatic insufficiency in Cystic Fibrosis. A comprehensive reporting of the topline results is expected by the end of Q2. Other deals are also in focus.
In January, the company announced a transformative in-licensing deal with First Wave Bio that added a new asset and proprietary formulations of micronized niclosamide targeting two new therapeutic indications- treatment for COVID-19 GI infections and immune checkpoint inhibitor-associated colitis (ICI-AC) to its clinical-stage pipeline.
Then, in April, the company announced the initiation of RESERVOIR, its Phase 2 clinical trial of niclosamide to treat COVID-19-related gastrointestinal infections. They also engaged with PPD, Inc., a leading clinical research organization (CRO), to manage both RESERVOIR and the Phase 1b/2a ICI-AC trial that will be launching next quarter.
In May, more value was earned after AZRX reported positive topline data from its Phase 2 combination therapy trial using MS1819 combined with the current standard of care, pancreatic enzyme replacement therapy (PERT). Shares jumped by more than 10% on the news after investors embraced the fact that MS1819 has the potential to supplant PERT as the gold standard treatment for EPI in patients with CF and chronic pancreatitis (CP).
Still, as good as the first half of the year has been, the stage is set for more significant milestones to be reached and potentially huge value-driving catalysts later this year. And with AzurRx staying focused on its mission to develop valuable therapies that can exploit considerable market opportunities in the GI space, shareholder value can be built sooner rather than later.
In fact, that value creation is already a work in progress.
Clinical Assets That Target Substantial Needs
Its’ most advanced clinical asset is MS1819, a recombinant lipase enzyme designed to treat EPI in patients with Cystic Fibrosis (CF) and Chronic Pancreatitis (CP). EPI is a common complication of CF and CP caused by an enzyme deficiency that leaves patients unable to effectively digest food and absorb nutrients. AZRX aims to provide a safe and effective therapy that controls EPI and improves upon pancreatic enzyme replacement therapy, primarily derived from pig pancreases, and requires patients to take upwards of 40 capsules per day to control symptoms.
As noted, the rewards from delivering an effective treatment could be substantial, with the EPI market in 2019 valued at more than $1.4 billion in the U.S. and over $2 billion globally. Better still, AZRX doesn’t necessarily have to go it alone. The positive interim results to date position AZRX, with MS1819, to attract partnership opportunities and licensing interest from Big Pharma. And as investors know, when partners come, valuations tend to rise.
Its micronized niclosamide is also an attractive asset earning its own share of attention. As noted, that therapy targets at least two different indications: COVID-19-related GI infections and immune checkpoint inhibitor-associated colitis in advanced-stage cancer patients. AZRX management sees this asset as more than synergistic to its clinical-stage portfolio; they see it as adding additional (or two more) shots on goal targeting a substantial unmet medical need that also brings sizable market opportunities.
While those assets are promising, success in a particular trial could have an exponential effect on share prices.
Blazing Its Own Trail
Perhaps the best news for investors is that AZRX is optimistic about its programs. Indeed, most companies are, but AZRX is taking that optimism to the next level by initiating discussions with contract manufacturers to develop an optimized microbead formulation of MS1819. In fact, they expect to have a product ready to advance into clinical studies early next year. And while the program takes time and money, AZRX assured investors that they have sufficient capital on hand to fund this development.
Better still, the cost-benefit profile of MS1819 is in their favor. Remember, the drug has a proven mechanism of action compared to PERTs. Moreover, it offers numerous therapeutic, safety, and compliance advantages while remaining relatively easy to manufacture. Hence, if this optimized microbead formulation proves successful in the clinic and receives regulatory approval, it’s likely that MS1819 could eventually eclipse pig PERT as the standard of care.
For those that didn’t know, the early 1980s ushered in synthetic “human” insulin, which completely replaced the cow and pig derived insulin that had been used for treating diabetes. Thus, the promise of MS1819 could lead to AZRX creating an entirely new market. Better still, they would own it.
A Surge In 2H 2021?
Indeed, for investors that appreciate the value of near-term catalysts, AZRX is a company to consider. They have multiple shots on revenue-generating goals and target conditions where there are high unmet medical needs. Better still, if its microbead formulation delivers the results intended, AZRX could earn an exponential increase in its valuation from a first-to-market, best-in-class therapy.
Best of all, meaningful updates are slated to get released throughout the remainder of this year. And the better news there is that any or all can lead to partnerships or licensing agreements. Thus, while the share price continues to consolidate at current levels, one thing may be for sure- AZRX could be only a single press release away from creating substantial shareholder value.
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