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Ask a Fool: What's Your Foolish Take on Prana Biotechnology?

In this video as part of The Motley Fool's "Ask a Fool" series, Fool health-care analyst David Williamson takes a question from a Fool reader, who asks, "What's your Foolish take on Prana Biotech (NASDAQ: PRAN  ) ?"

While there is a huge amount of investor enthusiasm surrounding the company and its drug PBT2, which would target Alzheimer's disease and Huntington's disease, that's exactly the source of David's concern about the drug and Prana itself. Any successful treatment to emerge for either of these indications would be a blockbuster, but real success has been extremely limited here, as these disorders are proving extremely difficult to crack.

David cites an article from Summer Street today coming out with a negative note on Prana, in which author Adam Feuerstein said he was "not enthusiastic about the drug's purported mechanism," and "not impressed with the data to date." Shares sold off dramatically today as a reaction to the article.

David warns that at the moment, Prana for all intents and purposes is defined by its PBT2 drug, and that investors should really consider whether the risk is worth the reward here, given how high he sees the likelihood of failure.

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Read/Post Comments (17) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On February 10, 2014, at 9:40 PM, somedaysoon wrote:

    Unfortunately neither you or Adam F have any idea on what Prana's Pbt-2 mechanism is. You both have succeeded in delivering false information. DYOR.

  • Report this Comment On February 10, 2014, at 9:44 PM, Cado05 wrote:

    I think Summer Street and Mr. Classen doesn't understand how Alzheimer PBT2 drug works, but Mr. Classen has degree in vaccine field . From today CET Research Group:

    "Classen is entitled to his opinion, but we're skeptical of his "analysis." Just in this short note above, Classen fundamentally mischaracterizes the mechanism of action regarding PBT2. He says that PBT2 is supposed to work, "as the company stated, dissolving beta amyloid plaques." But that's not what the drug does, nor what it is supposed to do.

    For years scientists thought that beta-amyloid plaques were the primary cause of the damage to neurons seen in Alzheimer's disease. This is what's known as the "amyloid cascade hypothesis." And while it's been the dominant focus of Alzheimer's drug R&D for the past couple decades, drugs designed to induce or accelerate the removal of beta-amyloid plaques have failed to show a real benefit to patients in late stage clinical trials. (It's also worth noting that many people who have beta-amyloid plaques in their brains never show any sign of Alzheimer's or cognitive impairment.)

    Prana is working under a different hypothesis. It, along with a growing number of scientists, now think that small beta-amyloid oligomers are the real culprits in Alzheimer's disease, because they have been found to float into synapses and short-circuit nerve cells important for memory. Consistent with these findings is the hypothesis by Prana scientists that it's the interaction between beta-amyloid and metals (such as zinc and copper) in the synapse that leads to the formation of small, toxic beta-amyloid oligomers which inhibit neurotransmission.

    Prana's theory has been referred to as the "metal interaction theory", the "metal-protein complex theory," and the "metals dyshomeostasis hypothesis". The crux of the idea is that the toxicity observed in neurodegenerative diseases such as Alzheimer's is the result of excessive interaction of synaptic metals with beta-amyloid proteins in the brain.

    PBT2 is designed to work upstream of the typical amyloid-cascade approach by preventing the interaction of synaptic zinc and copper with beta-amyloid in order to stop the beta-amyloid from becoming toxic and causing synaptic failure. According to Prana scientists, PBT2 is "able to achieve this by 'disarming' the beta-amyloid oligomers of synaptic metals, to achieve two beneficial outcomes: prevention of toxic metal-laden oligomer formation resulting in synaptic toxicity; and return of critical synaptic metals, otherwise bound to oligomers, to neurons, facilitating normal neurotransmission."

    So the drug is not meant to "dissolve beta-amyloid plaques" at all. The targets are the oligomers, which are much smaller than the plaques that ultimately form from hundreds of thousands or millions of the oligomer fragments sticking together".

  • Report this Comment On February 10, 2014, at 10:50 PM, seveB wrote:

    I would be interested in hearing/reading Mr Williamson's opinion and reasoning behind it. Here he has only stated that to date it's been a tough nut to crack and then refers to a third party source and their opinion.

    If Motley Fool is publishing an opinion or commentary shouldn't it be more researched than what has happened with other pharmas to date and someone else's research?

    I'm looking for value added through his insights to offer an opposing point of view to those researchers and scientists who support the Prana approach.

    There is nothing here that begins to do that.

  • Report this Comment On February 10, 2014, at 10:52 PM, emcmoney wrote:

    Poorly thought out pieces like this are why I ended my Fool subscription.

  • Report this Comment On February 11, 2014, at 1:53 AM, WavePhoreLoser wrote:

    All the posts so far (last = Feb 10 @ 10:52pm) are spot on. I can't understand why people with the skills to do serious analyses choose to do hatchet jobs (and I do recognize both Feuerstein and Williamson as skilled analysts).

    I'd like to add one more bit of info. Feuerstein claims that the Phase II results were unimpressive. Yet the last official analysis was dramatically impressive. The study was called "PBT2 rapidly improves cognition in Alzheimer's Disease: additional phase II analyses." The key sentence says that PBT2 "significantly improved executive function on a Neuro-psychological Test Battery (NTB) within 12 weeks of treatment in patients with AD.

    For the whole abstract go to

  • Report this Comment On February 11, 2014, at 8:14 AM, DebsHusband wrote:

    I am long PRAN, and the SummerStreet downgrade gave me an opportunity to pick up a few more shares at a slightly reduced price. I thank both SummerStreet and Motley Fool for creating this additional entry point.

  • Report this Comment On February 11, 2014, at 10:52 AM, faosto wrote:

    ""David cites an article from Summer Street today coming out with a negative note on Prana, in which author Adam Feuerstein said he was "not enthusiastic about the drug's purported mechanism...""

    you have the wrong author. Classen is the guy from Summer Street, not Feursrtein. He's from The Street, not Summer Street.

  • Report this Comment On February 11, 2014, at 3:21 PM, Pantagruel wrote:

    From the comments it seems that the analyst's

    scientific information is wrong on what the Prana drug is supposed to do. This is very confusing. My question is , do analysts have a right to speak about a drug , if they really do not understand its mechanism or behavior. ? Could someone please clarify what the real status and potential of the Prana Alzheimer drug is? Thank you.

  • Report this Comment On February 11, 2014, at 8:09 PM, erinisle wrote:

    I agree with cado05. I have been a shareholder of Prana Biotechnology for approximately six months. I realize the risk, but analysis should be based on facts, not unsupported opinion. There are at least 50 peer-reviewed articles that have been published in the most important neuroscience journals, most in the last year, supporting increasing evidence of metal involvement in Huntingtons and Alzheimers. The principal Prana investigator is Dr Rudy Tanzi of Harvard, one of the preeminent neuroscientists in the world. That does not mean they have the answer, but it does mean that criticism should be scientifically based and accurate, Williamson's "analysis" is flawed and worthless. I would appreciate knowing What CET Research Group is so that I can see what other information they have. Thank you.

  • Report this Comment On February 12, 2014, at 9:16 PM, cmarystewart wrote:

    If the above comments are correct (and I understand they are based on a review of the academic literature). This commentary is foolish in the traditional sense. Of course, prana is a high risk stock and that warning is appropriate. But if you comment on the science make sure you know what you are talking about and dont rely on second commentary of someone with a less than stellar scientific reputation. Very disappointing Motley Fool. You are better than this. Of course, the results of the pbt2 trial may disappoint but dont mistake that as justifying sloppy commentary.

  • Report this Comment On February 13, 2014, at 3:09 AM, cmarystewart wrote:

    The question is Motley Fool - are you willing to review the science? And acknowledge if you have been misled? THAT would show bravery and integrity.

  • Report this Comment On February 14, 2014, at 9:38 AM, pedrokoz wrote:

    GET SERIOUS ! You are actually basing you article on Adam Feuerstein ? You clearly need to learn something about investing. Look at this guy's background. He has no experience in medicine or clinical trials. His "undergraduate" degree is from a third college and has no graduate degree or advanced education. He's a freelance writer shooting from the hope. Pick up the phone and ask any well know biotech analyst what his or her thoughts are on Adam Feuerstein. Pick up the phone and call a VC focused on biotech. My phone never rang.

    I am surprise MF publishes this nonsense.

  • Report this Comment On February 14, 2014, at 9:46 AM, pedrokoz wrote:

    Take some responsibility Motley Fool ! You can't simply publish one-sided crap from a two hacks that know little about the science. Call Tanzi from Harvard. Call John Hopkins where the HD study is being conducted. And cancel my subscription to Motley Fool.

  • Report this Comment On February 15, 2014, at 3:48 PM, glasscattt wrote:

    I have to agree with Cado5, SeveB, emcmoney and WavePhoreLoser and the others. As a scientist, my first step was reading the following manuscript published in a peer reviewed journal. The link is: The mechanism of action of PBT2 is clearly not to "dissolve Alzheimer's placques" as stated by Mr Classen. The conclusions of the publication are adequately summarized in the title, "PBT2 Rapidly Improves Cognition in

    Alzheimer’s Disease: Additional Phase II

    Analyses". I would urge Classen and anyone without a scientific background in Alzheimer's disease (expertise in the vaccine field is not adequate) to have their analysis reviewed by someone with expertise in the field before posting it online.

  • Report this Comment On February 16, 2014, at 1:21 PM, Lane1 wrote:

    The principal behind Prana's anti-alzheimer's drug PBT2 is that if you remove copper and zinc from amyloid oligomers you stop oligomers from aggregating into plaques and thus arrest the progression of the disease.

    The real cause of Alzheimer's disease, though, is not amyloid oligomers or plaques, but peroxynitrites. When peroxynitrites are scavenged, the products are water and a nitrite anion. Amyloid oligomers by attracting copper and zinc increase the conversion of superoxide anions (which can also combine with inducible nitric oxide to form peroxynitrites) into hydrogen peroxide. Hydrogen peroxide combines with nitrite anions to reform peroxynitrites. Thus, if PBT2 is a highly efficient copper and zinc chelator, it will reduce the formation of peroxynitrites, but not stop the main routes to its production (via phospholipase C early on and via the nitration of NMDA receptors later on). So it is possible that the drug may slow down the progression of the disease early on, but it will not stop its progression. To do the latter you have to use peroxynitrite scavengers such as eugenol, ferulic acid, syringic acid, sinapic acid, vanillic acid, and curcumin.

  • Report this Comment On February 18, 2014, at 3:27 AM, PBTworks wrote:

    Well, well, just out that PBT2 trial result is a success!

    Suck eggs!!!

    Eat humble pies!!!

  • Report this Comment On February 18, 2014, at 11:16 AM, Lane1 wrote:

    A modest success at high levels in early Huntington's disease.

    AdamFeuerstein Adam's Blog


    Prana Bio Huntington's Disease Drug Fails Key Efficacy Hurdles

    To asses the efficacy of PBT2 in the study, Prana employed a Chinese menu of outcomes, nearly all of which failed to detect any benefit attributable to PB2 compared to placebo.

    The higher dose of PBT2 was able to improve the cognition of Huntington's patients versus placebo in only one of eight separate tests -- the Trail Making Test Part B.

    On a composite score of executive function, the high dose of PBT2 showed a statistically significant improvement versus placebo but only in early-stage Huntington's patients, not the overall patient population.

    But buried deep in Prana's press release Tuesday was the most important -- and negative -- assessment of PBT2's efficacy: "No significant changes were seen in motor, functional, behavioural or global assessments in either PBT2 treatment group compared to placebo over the 26 week treatment period."

    I would focus on the early-stage Huntington's patients because this is likely the same outcome for Alzheimer's patients. The drug can likely slow down the progression of both diseases early, but not help mid to late stage patients nor slow down the disease. Is this a success? More than the detractors of PBT2 are likely to acknowledge but neither is it a slam dunk for Tanzi and his supporters.

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David Williamson

The Motley Fool's Healthcare Analyst, I specialize in Pharma, Biotech, and how the ACA (Obamacare) is changing the business of healthcare in America. Follow me on Twitter for breaking stock news, policy thoughts, and misc musings...

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