Acurx Pharmaceuticals (NASDAQ: ACXP) provided an update showing that its position to bring a front-line treatment against CDI is on track. Highlights of, and certain events subsequent to, the first quarter of 2022 include enrollment continues in the Company’s ongoing Phase 2b clinical trial of patients with C. difficile Infection (CDI) with anticipated completion of enrollment late in the second half of 2022. It also included that based on the strength of its previously reported Phase 2a results (100% cure rate at end of treatment with no recurrences at Day 38 follow up visit), it amended the Phase 2b trial protocol to add a novel exploratory endpoint of Extended Clinical Cure, for study visits at day 56 and day 84 after the end of treatment for a selected group of subjects to evaluate the longer-term effect of ibezapolstat on the microbiome and on disease recurrence. According to ACXP, no comparable long-term data such as this has been conducted or reported with currently used antibiotics for CDI and it is not expected to interfere with the timing of completion of the Phase 2b clinical trial, and that it has added several clinical trial sites and anticipates up to 24 clinical trial sites will participate in the Phase 2b clinical trial; and
Further, ACXP added that is continuing its R&D collaboration with Leiden University Medical Center (Holland) to further evaluate the mechanism-of-action of Acurx’s inhibitors against the DNA pol IIIC enzyme, which is the bacterial target of our antibiotic product pipeline for the systemic treatment (IV and oral) of other gram-positive bacterial infections.
The sum of the new parts- ACXP is better positioned than ever to capture the front-line position to treat CDI. That’s not an overzealous presumption, either. Following another competitor’s miss in its late-stage CDI trial, it’s a likely proposition. The latest comes from Pfizer (NYSE: PFE), who missed meeting primary endpoints in its CLOVER Phase 3 trial targeting the treatment of C. difficile. And their miss isn’t the only one that positions ACXP to earn the front-line designation. Others didn’t fare much better.
Taking The Front-Line Position
Both Sanofi (NYSE: SNY) (2017) and Summit Therapeutics (NYSE: SMMT) (2021) also published discouraging topline results from their clinical trials. In addition, another pharmaceuticals company, Finch Therapeutics (NASDAQ: FNCH), recently announced a freeze in their Phase 3 trials enrollment resulting from a clinical hold letter from the FDA regarding concerns over the company’s SARS-CoV-2 donor screening protocols. While obviously bad for them, the totality of those competitor misfortunes does potentially bode well for Acurx, as it may significantly reduce the competitive landscape for ACXP should they continue to post best-in-class clinical trial results.
In fact, with several competing pharmaceutical companies reconsidering options, ACXP is even better positioned than ever to earn a front-line position to treat CDI. Moreover, even if companies like Pfizer or Finch find niche opportunities, ACXP may still emerge as the leader by providing the greater good.
For instance, in Finch’s case, its candidate focuses on the microbiome as a single dimension and has shown only a reduction in recurrent infection – far less impressive than the elimination of recurrent infection as ACXP can boast from its Ph2a trial data. In contrast, ACXP’s ibezapolstat is a dual impact drug that addresses the direct infection and avoids recurrent infection altogether (so far) while at the same time restoring the microbiome. Thus, in a side-by-side comparison, ACXP’s candidate is seemingly better than Finch’s one dimension drug in cases of multiple recurrent infection, making it potentially the only choice between the two for first-line treatment.
And with each new step forward in ACXP’s CDI treatment development roadmap, it’s becoming more evident that the disconnect between the ACXP share price and its intrinsic and inherent value is getting much too big to ignore.
More Pharmaceutical Companies Miss Trial Targets
That’s because Acurx is excelling in its CDI clinical trials when others are failing. PFE, SNY, and SMMT all reported unimpressive topline results from clinical trials of their competing treatments. Still, what’s notable, and a testament to the value opportunity from the indication is that these companies are still willing to fight to advance them. This is excellent news for ACXP and shows they are moving the right drug forward at the right time to address a significant and unmet market opportunity.
As reported in March, Pfizer joined two other companies that showed less than impressive data from their late-stage C. difficile trials. All three had topline misses, often a death knell for a clinical trial. Further, all three appear to be evaluating ways to save their programs, knowing that the potential market in dollar terms to treat CDI is well worth the fight. Still, while admiring the ambition, expect PFE, SNY, and SMMT to have uphill battles. But, as noted, bad news for them is potentially excellent news for ACXP.
Actually, Pfizer itself might have reasons to look at ACXP. They may have even tipped their hand to that effect. Its CLOVER trial update commentary made clear they are still interested in the billion-dollar-plus market opportunity. But, they likely realize at the same time that they need a better candidate, especially with hopes of its drug becoming a front-line treatment all but evaporating based on its data set. Still, the good news for patients, and investors, is that ACXP may have what PFE needs. And that could lead Pfizer to look beyond niche indications and potentially partner with the new leader of the trial pack.
Even Pfizer knows its options are limited. As indicated in its press release last month, Pfizer said it intends to pivot toward treating high-risk and the most severe cases of CDI. This move keeps them in the game and allows them to leverage what they have to take advantage of revenue-generating opportunities in the “fringes” of the CDI treatment market.
Notably, those fringes aren’t necessarily small opportunities. Still, they wouldn’t be able to replace Pfizer’s original assessment of its market potential for an approved vaccine being over $1 billion if used as a front-line therapy and beyond. By the way, their market-size assessment validates the modeling generated by Acurx and is likely a contributing factor in Pfizer’s decision to retain its market focus in severe cases. With billions of dollars in play, why not?
ACXP is Leaving the Competition Behind
This is all excellent news for Acurx Pharmaceuticals and the company’s investors. However, here’s the best part: AXCP has the potential to be one of the only companies to bring an effective CDI treatment to market. With three competing pharmaceutical companies struggling in their clinical trials and one tied up resolving concerns with the FDA, this outcome is looking more likely by the day. Not only that, ACXP has compelling trial results.
In fact, ACXP’s data is about as good as it can get. Its Phase2a data showed 100% cure and 100% sustained cure after a 30-day follow-up. That not only bests Pfizer’s known results, but it also goes layers deep to better additional indications that Pfizer targets in its secondary endpoint indications. The best takeaway from Pfizer’s update was that its candidate was safe.
Again, so is ACXP’s. Moreover, ACXP’s CDI candidate demonstrates a restoration of the patient’s microbiome during treatment, which is highly unusual for an antibiotic. Thus, management considers ibezapolstat somewhat of a “dual impact” therapy in that it restores the microbiome while tending to the acute infection.
Leveraging a Pristine Track Record
That helped launch its Phase 2b trial enrollment without a hitch, making it one of the only clinical-stage companies without a blemish on its record in treating the debilitating infection.
Thus, despite ACXP stock’s ability to decouple from broader market weakness, a massive valuation disconnect still exists. But from an investor’s perspective, that’s not necessarily bad news. Current share prices don’t just expose an attractive value proposition; they may present an opportunity too good to ignore.
There’s still more to like. In addition to ACXP benefitting from a potential shrinking of the competitive landscape to treat CDI, its Phase 2 trial evaluating ibezapolstat also shows a probability of possible change for the better in an antibiotics drug landscape that hasn’t seen meaningful improvements in more than three decades. Better yet, as ACXP advances its Phase 2b trial, they extend its competitive distance in its targeted CDI indication. Of course, that’s good news for ACXP, its investors, and patients alike.
Best in Class Data
Moreover, with Phase 2a data already suggesting ibezapolstat could become the go-to drug to treat CDI, the best news is that hundreds of thousands of patients per year may finally get effective treatment for the debilitating infection – one that may uniquely include substantially reduced risk of reinfection.
Data from its Ph2a trial was exceptional. In fact, it was so good that it led the Trial Oversight Committee and the Scientific Advisory Board to allow for early termination of its Phase 2a trial and advance straight into a Phase 2b study. This decision was made after data on just ten patients showed a 100% cure rate and 100% sustained cure after follow-up when treating patients with C. difficile.
Investors should like this part of the investment proposition, too. ACXP could move through its Phase2b trial quickly, with enrollment already underway and the duration of treatment relatively short. Treatment cycles can run as little as ten days, with follow-up done at 30 days. Thus, with ACXP powering through its Phase 2b trial supported with best-in-class data and a well-levered expectation to enter Phase 3, ACXP stock at current levels appears appreciably undervalued. More on that later.
For now, know this- ACXP is better positioned today than at any time in its history to create substantial shareholder value in the near term.
Development Mission Expedited With QIDP and Fast Track Designations
That may happen quickly. The FDA has already granted ACXP a Qualified Infectious Disease Product (QIDP) and a fast-track designation for the company’s ibezapolstat treatment to accelerate the drug’s path through trials and review. This is likely a recognition by the FDA that Vancomycin, the current standard of care for CDI, has a recurrent infection rate of up to 40%, meaning it is not as effective in long-term treatment.
Of course, efficacy matters, and ACXP is also checking that box. According to Robert J. DeLuccia, Executive Chairman of Acurx, “With the excellent clinical results and very good safety and tolerability demonstrated in the Phase 2a segment of this ongoing trial, we validated the bacterial pol IIIC enzyme as a therapeutic target for ibezapolstat, our first product candidate in our new class of antibiotics. Additionally, this trial segment showed potentially beneficial effects of ibezapolstat on the intestinal microbiome and bile acid metabolism.”
This is high praise for ACXP’s candidate, but investors need not rely on the company’s opinion alone.
Ibezapolstat Phase 2a Clinical Trial Results
The results from ibezapolstat’s Phase 2a trial justify the growing optimism. Data was so impressive, in fact, that after monitoring patients for recurrent infection for 26 to 30 days, an assessment of the safety and efficacy of the Phase 2a treatment by the Trial Oversight Committee and the Scientific Advisory Board, which includes three of the leading infectious disease experts setting Infectious Disease Society of America (IDSA) treatment guidelines for C. difficile infection, recommended to terminate the Phase 2a trial early and move straight on to a Phase 2b trial. Given it was partially a panel of experts on C. difficile that issued this recommendation, it seems as though Acurx is capturing the attention of critical medical experts.
Deservedly so. Acurx Pharmaceuticals’ ibezapolstat completed primary and secondary treatment objectives in trial patients with a 100% success rate, successfully curing C. difficile infection in all participants while preventing 100% of recurrent infections. Compared to the recurrent infection rate of up to 40% with the current standard of care for CDI, this result is exceptional.
A Novel Treatment That Can Help Millions
An approved ibezapolstat will likely meet overwhelming demand if late-stage clinical trial data is consistent with current results. Moreover, in addition to the likelihood of tremendous commercial success for ACXP and its investors, ACXP could help hundreds of thousands of patients per year needing better treatments.
The 2017 update of the Clinical Practice Guidelines for C. difficile infection by the Infectious Diseases Society of America (IDSA) and Society or Healthcare Epidemiology of America (SHEA) indicates that C. difficile infection presents a significant problem to those in healthcare settings and among the general population. The disease is so prevalent in hospitals and long-term care facilities that the New England Journal of Medicine called C. difficile one of the most common causes of health-care-associated infections in hospitals.
As a matter of fact, C. difficile is estimated to cause over 500,000 infections each year in the United States, with about 20,000 of these cases being fatal. Across a sample of 150,000 patients, Acurx Pharmaceuticals estimates that the recurrence rates of three common treatments for CDI range between 20% and 40%. Overall, this means that C. difficile infections, climbing to an incidence of 600,000 with a high recurrence rate, are 9.3% fatal. If Acurx’s treatment continues to post excellent results in its Phase 2b trial, ibezapolstat could be a treatment that changes the lives of hundreds of thousands of patients.
That would be excellent news all around. And with ACXP expected to provide updates throughout 2022, positive effects on ACXP’s valuation could also be in the queue. And that upside potential is substantial and justified when putting ACXP’s current valuation against peer companies.
While putting ACXP’s valuation side-by-side with Pfizer and Sanofi isn’t a fair comparison, it is against Summit Therapeutics (NASDAQ: SMMT). After all, they, too, had a C. difficile treatment candidate in a Phase 3 trial that showed promise, and unfortunately for them, it missed its endpoints. The point is that while a phase 3 contender, SMMT held a market cap more than 10X higher than ACXP. Hence, that valuation could be a precursor for things to come on a comparative basis.
Changing the Future of CDI Treatment for the Better
Best of all, at least for ACXP and its investors, its ibezapolstat treatment shows mounting evidence to suggest that it may be the best option available to treat CDI and guard patients from recurrent infections.
Data published from ACXP’s Phase 2a trial in Clinical Infectious Diseases, one of the most respected journals in the medical community, indicates that ibezapolstat is well positioned to earn the front-line treatment crown. According to the article, ibezapolstat showed ideal traits as an oral antibiotics candidate, demonstrating a highly potent response against C. difficile, good tolerability, and limited gastrointestinal absorption. That resulted in very high fecal concentrations, which may reach three orders of magnitude above the MIC for C. difficile.
The article further noted that in addition to the ibezapolstat treatment being highly effective at killing C. difficile, it appears to do so while maintaining the populations of helpful bacteria in the gut microbiome. These signs indicate that the treatment may do more than cure CDI in the short term; it can significantly reduce the likelihood of recurrent infection. The article also highlighted that the favorable early impressions are supported by ACXP’s trial results, which found no recurrent infections in patients treated with ibezapolstat.
What’s it all mean? Put simply, ACXP’s trial data thus far indicates that ibezapolstat could be the much-needed first-in-class antibiotic to change the way C. difficile infection gets treated.
ACXP Preparing for an Extraordinary 2022 Following Phase 2b Trial
At the end of the day, investors need to pay attention to Acurx Pharmaceuticals having a spotless data set across the company’s ibezapolstat clinical trials, which becomes even more impressive when considering the failures of the company’s most significant competitors. And that leaves, pending approval of its CDI treatment, Acurx to likely capture the lion’s share of a $1.5 billion market opportunity.
Another thing to consider is that it’s rare to see a biotech company publishing trial data as compelling as ACXP’s to remain valued at under $100 million. And at roughly $36 million today, that suggests ACXP is appreciably undervalued. But, markets do correct, and ACXP is ripe to move higher as investors continue to evaluate the opportunity inherent to ACXP, especially as the potential last company standing in the race to get a CDI treatment to market.
Thus, the rewards could be significant for investors catching ACXP during market weakness. In fact, from current levels and based on historical and recent peer comparison, the increase in ACXP stock could be exponential.
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