VistaGen fails phase 2 depression trial, sparking stock rout

purple brain
A phase 2 failure of AV-101 in major depressive disorder drove VistaGen’s share price down below $1. (Raman Oza/Pixabay)

A phase 2 trial of VistaGen Therapeutics’ AV-101 in major depressive disorder has missed its primary endpoint, sending shares in the nanocap biotech down 64% premarket. VistaGen responded to the failure of the ketamine-line drug by vowing to review all the data before deciding on next steps.

Expectations for the phase 2 were dampened in May when an investigator-sponsored trial of AV-101 suggested the NMDA receptor glycine site antagonist is ineffective in depression as a monotherapy.  VistaGen pointed to differences between the designs of the two trials to caution against reading too much into the first failure, but ultimately the top-line takeaways from the studies were similar.

In the latest readout, VistaGen found AV-101 was no better than placebo at improving scores on the MADRS-10 depression scale, causing the study to miss its primary endpoint. VistaGen is yet to share data from the 199-subject study, but the qualitative impression is of an unequivocal failure. 

"The rigorous conduct of the study makes us confident that AV-101, at the concentrations used, was not effective,” Massachusetts General Hospital’s Maurizio Fava, the study’s principal investigator, said in a statement.

VistaGen is yet to give up on AV-101, though. CEO Shawn Singh pointed to the possibility that either AV-101 may have failed to cross the blood-brain barrier in sufficient quantities or that too little of the active metabolite accrued in the target tissue to argue the drug may have a future. If those reasons explain the failure, VistaGen thinks combining AV-101 with anion transport inhibitor probenecid may help. 

Singh and his colleagues plan to keep reviewing preclinical and clinical data on AV-101 in a handful of indications into 2020 before deciding whether to run further studies. The lack of psychotomimetic side effects or serious adverse events in the phase 2 means tolerability is unlikely to be a barrier to further development.

VistaGen wants to push ahead with other programs while figuring out what to do with AV-101. Nasal spray PH94B is set to enter phase 3 in social anxiety disorder while PH10 is moving into phase 2 in major depressive disorder. 

Whether VistaGen can bankroll all of its planned activities is another question. VistaGen ended September with $4.1 million in cash and cash equivalents. With the phase 2 failure driving VistaGen’s share price down below $1, the biotech’s ability to raise cash is constrained.