Positive Phase II data for NeuroSigma comes after IPO postponement

An illustration of the proposed second-generation eTNS system--Courtesy of NeuroSigma

NeuroSigma released top-line data for its noninvasive neuromodulation device to treat major depressive disorder (MDD). Next, the company plans a large, multicenter, double-blind clinical trial in this indication. It may use that data to seek FDA approval; its Monarch eTNS system already has a CE mark in Europe as an adjunct treatment for MDD and is approved in Canada to treat MDD.

It's not quite clear how the startup plans to finance these efforts, though. It postponed a planned $50 million IPO in early October citing the usual culprit of poor market conditions. It initially filed for that IPO confidentially in November 2013.

NeuroSigma had only $1.6 million in cash at June 30, according to its latest SEC filing. Of the projected $43.2 million in IPO proceeds, the largest amount--$10 million--was earmarked for a pivotal trial of the eTNS system to treat drug-resistant epilepsy intended to be in support of an FDA approval.

The Phase II data for the trigeminal nerve stimulation device to treat MDD show that patients receiving the treatment experienced greater improvements in symptom severity than patients on a sham therapy. Of the treatment patients, 41.7% demonstrated improvement, while sham patients had only 10.9% improvement.

The University of California, Los Angeles, researchers who conducted the study expect to release further data from it next year. This was a dose-ranging trial of 43 adults with MDD; treatment subjects received stimulation from the eTNS device for 8 hours nightly for 6 weeks.

"Like the open-label Phase I clinical trial results at UCLA, this dose-ranging study demonstrates a statistically significant improvement in symptom severity, extends this finding under double-blind controlled conditions, and justifies further development of this intervention," said NeuroSigma CMO Dr. Ian Cook in a statement.

In addition to this data, the success of neurostimulation player Nevro ($NVRO) in raising a whopping $145 million earlier this month could help NeuroSigma get up the nerve to make its own IPO run.

- here is the Phase II release
- and the latest SEC filing

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