Pharmaceutical Company Sets Gold Standard for New Drugs

Algernon Pharmaceuticals Inc. (CSE:AGN; OTCQB:AGNPF; XFRA:AGW0) has announced that it has received a notice from the US Patent Office regarding one of its primary development projects, and released news about the development of another drug. 

Algernon is a publicly traded drug development company that works in the fields of chronic cough, stroke and brain injuries, Idiopathic Pulmonary Fibrosis (IPF), and CKD. The CEO is Christopher J. Moreau, and the CFO is James Kindly.

Repirinast Patent and Ifenprodil Development

Algernon Pharmaceuticals recently announced that it had received an allowance from the United States Patent and Trademark Office (USPTO) for the patent application it filed for a chronic kidney disease drug, Repirinast. The company also filed patents in Canada, Europe, China, and Japan. According to Christopher J. Moreau, the CEO of Algernon Pharmaceuticals, "this is the first allowance notice received from the USPTO by Algernon for one of the drugs being investigated under our innovated drug repurposing program and is further validation of our intellectual property strategy." Algernon's strategy for the patent application includes the method of use, dosing and formulations, and for new composition of matter patents based on novel salt forms.

Repirinast claims to treat non-alcohol fatty liver disease (NAFLD). According to the data from Algernon, Repirinast reduced hepatic fibrosis by 57%, reduced the NAFLD score by 31%. In comparison, telmisartan, the current standard of care for NASH, only reduced fibrosis by 27%.

Based on the data, Repirinast is the company's leading treatment for CKD. Patients with CKD are at an increased risk of NAFLD even when controlling for other co-morbidities.

Algernon has also announced that it is planning a Phase 2b RCC study for a drug known as Ifenprodil. The data from the completed Phase 2a RCC study showed that if the drug is administered three times daily for a period of three months, it can reduce the geometric mean cough counts by about 40% from the established baseline. Dr. Jacky Smith, Algernon's chief scientific and medical advisor and an expert on coughs, conducted the statistical review. According to Dr. Smith, "the additional analysis confirms my initial positive impression of the study. The NMDA receptor has always been an interesting target for cough, but other agents have been poorly tolerated. To see effects of this magnitude in an IPF population, where other drugs have failed to demonstrate a benefit, is notable."

Ifenprodil is also notable because it affects central signaling and works by targeting the brain instead of the lungs, but it has zero reported cases of taste disturbance, which was a reported side effect of the Merck drug.

Pharmaceuticals Focusing on Research and Development

According to Evaluate Vantage, spending on pharmaceutical research has largely held steady after the uptick in funding related to the COVID-19 pandemic. The biggest spenders in 2022 were Roche, overtaking Pfizer, who was first in 2021. Bristol and Johnson and Johnson cut their spending in 2022 by 5% and 4% each. Astrazeneca increased its spending by 19%, citing the acquisition of Alexion as the reason for the uptick in funding for research and development. Moderna and Regeneron have reinvested some of the profit they received last year into research.

Johnson and Johnson provided a positive earnings report this week. The reported revenue exceeded previous estimates at US$13.4 billion in pharmaceutical sales with a growth of 4.0% year over year. While this is good news for the company and continued growth is expected, it is still not enough to meet the company's goal of $60 billion by 2025, in part because pharmaceutical patents is an extremely competitive market.

The Future at Algernon

There are a number of catalysts working in Algernon's favor. The company achieved positive Phase 2a data related to research on Idiopathic Pulmonary Fibrosis and chronic cough. According to Clive Maund, Algernon is an obvious choice for investors: "It is thus worth taking into consideration that the company has brought a highly effective drug / treatment to the late stages of development... and it would seem from the price / volume action in Algernon over the past week that some investors are starting to join the dots and figure out what this means for Algernon... Algernon has developed a highly effective product and its stock price is silly cheap and so a good investment."

Algernon has also received coverage from Streetwise in the past related to its research into using DMT to treat brain injuries and is currently engaged in a Phase 1 study. Algernon has established Algernon NeuroScience and filed a Form 1-A offering statement with the U.S Securities and Exchange Commission (SEC) in relation to the DMT clinical trials.

In Q1 of 2023, Algernon began the Phase 1 study for DMT as a treatment for brain injury. In Q2 of 2023, Algernon expects to file a US FDA IND filing and fast track application related to Idiopathic Pulmonary Fibrosis, and a US FDA IND filing for chronic cough. The company should also begin complete manufacture for CKD. In Q3, Algernon anticipates the release of the data for the Phase 1 DMT data and to begin the phase 1 study for CKD. In Q4 of 2023, Algernon will begin the Phase 2b study for chronic cough and begin Phase 2 for the DMT study.

Ownership and Share Structure

Algernon has 9.65 million shares outstanding and 9.28 million free float traded shares. There are 2,769,768 warrants, and 931,000 options. The company has a market cap of CA$1.93 million. Algernon trades in the 52 week period between 0.24 and 1.46.

In terms of institutions, the Canadian firm, Alpha North Asset Management, owns 13.15% of the company. Palos Management Inc. owns 1.24%. Algernon reports no strategic investors.

Management and insiders own approximately 5% of the company. Christopher Moreau owns 1.31%, while Rajpaul Attariwala owns 1.14%. Harry JF Bloomfield owns 0.69%, Mark Stephen Williams owns 0.33%, Howard Gutman owns 0.29%, James FCA Kinley owns 0.10%, and Michael Sadhra owns 0.02%.

As of March 1^st, 2023, Algernon has CA$0.5 million dollars. The company reports a monthly burn rate of CA$80k, which goes to clinical trials and research costs.

There are no potential sellers to report, or other negatives.

Algernon works with a number of multipliers, including several IR firms: PR Media Now, Market One Media, Stockhouse, Proactive Media, Radius Research, Psychedelic Finance, Microdose, BTV Media, and Capital Analytica. Andre Uddin of Research Capital provides analysis and news coverage of the company.

Disclosure:
1) Amanda Duvall wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. She or members of her household own securities of the following companies mentioned in the article: none. She or members of her household are paid by the following companies mentioned in this article: none. His/her company has a financial relationship with the following companies referred to in this article: none.
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