It's a case of déjà vu as Alzheon pulls IPO again

Alzheon needs funding for a new trial, and is getting short of cash. (VSRao / Pixabay)

Alzheimer’s drug developer Alzheon has pulled plans for a public listing on the Nasdaq for the second time in nine months.

The biotech—which has a small-molecule drug for Alzheimer’s in early clinical testing—told the SEC yesterday that it had decided to withdraw its latest IPO prospectus, originally filed last August, which sought to raise $30 million though the sale of 6 million shares at a range of $4 to $6.

Alzheon also had a tentative attempt at a larger, up to $80 million-plus IPO earlier in 2018, submitting a registration document in March which was then pulled at the beginning of May.

The decision not to proceed with a dramatically downsized attempt is a blow to the company, which is seeking additional funds to advance its lead drug ALZ-801 into a phase 2b trial. That’s another dial-down since its first IPO, as Alzheon had initially planned to use the proceeds for a full-blown phase 3 study.

Amyloid-targeting Alzheimer’s drugs are a high-risk option, with an ever-extending list of candidates that have failed to move the needle on memory and cognition measures in clinical trials, and it seems that track record is making Alzheon’s quest for a public listing a challenge. That’s also a problem because the company is running on low cash reserves, with the latest prospectus indicating it had cash and equivalents of just over $3 million as of June 30, 2018.

The Framingham, Massachusetts-based biotech picked up the rights to ALZ-801—also known as tramiprosate—from Neurochem (now Bellus Health) in 2013. At the time, the drug had been discarded after failing to improve cognition in patients with Alzheimer's disease in a 2009 study.

Undeterred, Alzheon reckoned it could resurrect the program by targeting a subgroup of patients with two copies of the APOE4 gene, a group that accounts for about 10% of Alzheimer’s patients. It tweaked the formulation to improve its side-effect profile and reported some encouraging data from a phase 1b trial at the Alzheimer’s Association International Conference in 2016.

The biotech followed that up with additional data at the Alzheimer’s Association International Conference last July showing that—according to the widely used ADAS-cog rating scale—57% of patients remained cognitively stable over the 18-month trial period, compared to just 20% of those on placebo.

At the time, Alzheon’s founder and CEO Martin Tolar, M.D., Ph.D., said he thought that evidence was building that drugs which target amyloid aggregation at the pre-plaque fibril stage—a group that also includes Biogen’s aducanumab and BAN2401—are showing a disease-modifying effect.