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Evgen Pharma and the power of plants for potential drug breakthrough

Evgen is a small company hoping to make a major splash with a plant-derived drug
Evgen Pharma and the power of plants for potential drug breakthrough
It turns out eating your greens is good for you - cue Evgen Pharma

How many of us as children sat for the final five minutes of a meal pushing that last stem of broccoli around the plate to the parental refrain: ‘eat your greens, they’re good for you’?

In the 1990s a very smart chap called Paul Talalay, professor of pharmacology at Johns Hopkins School of Medicine, provided some persuasive scientific evidence that your folks were actually right.

In fact, Talalay and his team went several steps further by isolating sulforaphane, a detoxifying agent that is not only thought to be effective against cancer, but diseases such as Parkinson’s and multiple sclerosis.

So cue a raft of life-saving drugs spawned from plants, like broccoli, in the brassica family?

Well, not quite; there’s a problem. The sulforaphane molecule is only really stable at low temperatures. By low I mean a reading of around minus 20.

This, and the fact it had to be held in an inert gas, has severely limited the applications of Talalay’s breakthrough.

Now fast-forward a quarter of a century and a small company with big ambitions is hoping to make a major splash with a plant-derived drug.

For Liverpool-based Evgen Pharma's science has developed a way of stabilising a synthetic version of sulforaphane so it can be used as a mainstream pharmaceutical.

Its drug candidate, SFX-01, is being developed to treat cancer and subarachnoid haemorrhage (SAH), a rare form of stroke.

When it floated on AIM last October it raised £7mln, having received £2mln just before the IPO.

The cash ensures Evgen, led by Dr Stephen Franklin, has the financial wherewithal to complete two Phase II trials.

Patients in the first group, suffering SAH, are already being dosed.

In all 90 people will receive the treatment in what’s called a double-blind, placebo-controlled study.

The results are expected in the second quarter of 2018 – around the same time as the ‘read-out’ from Evgen’s other trial.

This second clinical study will assess the efficacy of SFX-01 in women with metastatic breast cancer.

The current front-line treatments are hormone therapies, which have a major limitation:  they don’t kill the cancer stem cells that lead to the recurrence of the disease and so patients ultimately become resistant to the medicine.

It is hoped SFX-01, by targeting cancer stem cells will overcome this resistance problem.

One can immediately see the potential in breast cancer for a combination therapy that allows sufferers to manage metastatic breast cancer as a chronic disease rather than a life sentence.

For companies that make the hormone therapies it offers the opportunity to significantly extend the time of the usefulness of the product from perhaps 12 months to many years in some cases.

Big pharma companies are very interested in SFX-01 and one even tried to buy Evgen shortly before it was floated back in December 2015.

But Franklin and his team want to deliver Phase II data on both breast cancer and SAH before concluding a licensing deal or deals.

The stroke indication offers potentially the quickest route to market as the product is likely to be given orphan status by the US Food & Drug Administration.

An orphan drug is one that offers treatment for rare and incurable ailments.

Practically, gaining orphan designation would allow SFX-01 to go on sale after the completion of Phase II trials if the drug proved efficacious and a Conditional Market Approval is gained.

It would still have to complete the final leg of clinical studies, but could be earning income at the same time.

The current funding runway gets Evgen to the conclusion of clinical trials in two indications for SFX-01, so there should be no need to come to the market - particularly at the current depressed share price.

It may apply for grants, or look for other  non-dilutive funding if the results from preclinical work on SFX-01 for multiple sclerosis is compelling.

“[The study] reads out this year and, if the results are positive, people will see the potency of the molecule relative to a drug doing US$5bn a year – the Biogen product Tecfidera,” said Franklin.

As mentioned above, the share price has drifted since listing. The fundamentals haven’t changed; if anything they have improved.

The waning popularity of the biotech sector here in the UK has had an impact.

Compounding the misery is the fact Evgen’s stock is sparsely traded, because a large base of investors who bought in under the enterprise investment scheme must hold for at least three years.

This lack of liquidity means that a modest share sale can have a disproportionate and negative impact on the company’s valuation.

The flipside of this that any good news on clinical trials is likely to prompt a rebound.

“I have always said to investors that this company will be worth a significant amount of money if one or both of these trials work,” said Franklin.

“This is what investors are backing. So anyone who comes in now should be at least waiting for the read out [of the latest clinical trials].”

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Article
October 21 2015

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