Neuralstem: An Update on Potential Catalysts for 2015 (CUR, Buy, 3.38)
Overview and Investment Thinking
I wrote a report on Neuralstem on August 26, 2014 in which I projected the timing of important investment catalysts for 2015. This is an update of that report although there have been no significant changes since then. I think that the phase 2a data from the trial of the Company’s NSI-566 neural stem cells in ALS is the key event by far in 2015. I believe the results will be positive and this could cause a significant increase in the stock price.
The lead investigator in the study, Dr. Eva Feldman, has already stated publicly stated that patients in the phase 2 trial appear to have had their ALS stabilized and she is writing a protocol for the phase 3 trial. This suggests good phase 2 data. Because ALS inexorably progresses causing a steady month over month deterioration, stabilization is a very positive outcome. With the phase 2a data, there will be meaningful clinical data on 27 ALS patients from both phase 1 and phase 2. This is admittedly a small number of patients, but in an intractable disease without therapeutic options like ALS, it might be sufficient to start a pivotal phase 3 trial in 2015. Obviously, this is dependent on the data being positive, but the results from phase 1 and Eva Feldman’s encouraging comments suggest that there is a strong possibility for this.
Phase 2a Trial of NSI-566 Stem Cells in ALS
The phase 2a trial began in September 2013. The first 12 patients in the trial received injections in the cervical region of the spinal cord only. The dose was escalated by cohorts (composed of three patients) with the first cohort (patients 1, 2 and 3) receiving five cervical injections of 200,000 cells for a total of 1,000,000 cells. This was the same number of cells that Ted Harrada received in his first surgery although his were transplanted in the lumbar region; later he received cervical injections. The fourth cohort (patients 10, 11 and 12) received 20 cervical injections of 400,000 cells each for a total of 8 million cells. The fifth and final cohort of three patients received 20 cervical and 20 lumbar injections of 200,000 cells each for a total of 16 million cells. Animal studies have suggested that 16 million cells might be the optimal dose in humans.
Neuralstem announced on August 4, 2014 that the last patient in the final cohort had completed their surgery. The endpoint of the trial is based on results seen six months after surgery. Hence, the final patient in the trial will have progressed six months beyond surgery in early February. This will allow the Company to lock the data base and analyze the data. It may take a few weeks to gather and analyze the data so my best guess is that the topline data may be available sometime in March 2015.
The Company could choose to announce the data at a medical conference and the American Academy of Neurology meeting of April 18 to 25 might be a forum. I think this is the latest potential point at which investors will learn of the results for phase 2a. It is also possible that the Company could make a press release on topline data sometime in March or at some earlier conference than AAN. Hence investors may learn of the phase 2a results sometime in the March-April timeframe.
The final three patients treated in the trial will be by far the most important group. Their dosage of 20 cervical and 20 lumbar injections of 200,000 cells each for a total of 16 million cells could be the dosing chosen for a phase 3 trial. Given the strong efficacy achieved with lower doses of cells I think that we can expect good efficacy. If so, the focus will be on safety.
Phase 1 Trial of NSI-566 Neural Stem Cells in Chronic Spinal Cord Injury
The fourth and final surgery in this phase 1 trial could complete by the end of March, 2015. Final results are based on the outcome at six months so that the trial should complete by the end of September 2015 allowing for data analysis. Because this is an open label trial we may hear anecdotal comments on the outcomes of these patients in 2015.
The goal is to determine if NSI-566 neural stem cells can restore neural signaling in patients who have been paralyzed for some time because of a spinal cord injury. The functioning of NSI-566 cells in treating this condition is very different from ALS. I don’t think we can extrapolate encouraging results in ALS to spinal cord injury. I am making no predictions of the potential outcome of this trial. I am waiting for the data. I would note that any anecdotal reports of a meaningful response in spinal cord injury patient would likely trigger widespread media coverage.
Phase 2 Trial of NSI-189 in Major Depressive Disorder
The phase 2 trial of NSI-189 in major depressive disorder could start in March 2015. The trial design has not yet been described by the Company nor has it appeared on ClinTrials.gov. Based on public statements of management, I think this will be a roughly 150 patient trial that would last 18 to 24 months. This probably will have little effect on the stock.
Litigation with Stem Cell Therapeutics
There was a bench trial on the Stem Cell litigation in December to determine if the lawsuit has standing. If it does have standing, the actual lawsuit will begin in 2015. If not, the lawsuit probably will not proceed. The bench trial has completed and we could hear the results sometime in 1H, 2015. I see the worst case for Neuralstem in the event that they are found to infringe on StemCell patents to be the requirement to pay royalties on their products of 1% to 4% over the approximate period 2018 to 2021. However, this is a layman’s opinion and should be taken as such.
Other Data Points
The IND for a phase 1 trial of NSI-566 stem cells for the treatment of acute spinal cord injury in South Korea is expected in 1Q, 2015 and the trial could start in 2Q, 2015.
Neuralstem is being very quiet on the status of the trial of NSI-566 stem cells in ischemic stroke patients in China. I don’t know if we will hear anything in 2015. I recently reported an anecdotal report on this trial. http://smithonstocks.com/neuralstem-some-encouraging-but-very-early-information-on-chinese-ischemic-stroke-trial-using-nsi-566-stem-cells-cur-buy-2-59/
Tagged as CUR, Inc., Neuralstem, Inc., NSI-566 neural stem cells + Categorized as Smith On Stocks Blog
“The phase 2 trial of NSI-189 in major depressive disorder could start in March 2015. The trial design has not yet been described by the Company nor has it appeared on ClinTrials.gov. Based on public statements of management, I think this will be a roughly 150 patient trial that would last 18 to 24 months. ”
How can they afford what sounds like a very expensive phase 2? Sadly, I would imagine they simply can’t and that’s why there’ll be no scheduled trial until they dig up a deep-pocketed partner.
They have sufficent funds to conduct a phase 2 trial of NSI-189. You are correct that they will need to partner this product with someone who has deep pockets. This will be done after the phase 2 if the results are encouraging.
RE NSI-189… Phase 1 final results have yet to be published in a peer reviewed journal and will include the long awaited MRI results. Should be 1H 15.
Also, no mention of the possibility of BTD for the ALS treatment?
Many thanks.