Antidepressant R&D Takes Another Hit with J&J

Multiple approaches to depression treatment fail trials

Feb 11, 2014 at 6:08PM

Johnson and Johnson (NYSE:JNJ) is the latest to suffer a failed depression treatment. ADX71149, in-licensed from Addex Therapeutics, recently failed to meet its primary endpoint for anxious depression in Phase 2a trials. While it failed to beat placebo for anxious depression, it will still be studied for other uses, partially based on the study showing efficacy signals on both anxiety and depression measures.

The license agreement between J&J and Addex would have dealt 112 million euros in milestones and double-digit royalties. For Addex, which is publicly traded in Switzerland and already undergoing cost-cutting measures, this announcement is a major setback. ADX71149 was one of the two lead products for the company. The other compound was dipraglurant for levodopa-induced dyskinesia in Parkinson's disease. Addex focuses on small molecules that function as glutamate receptor modulators, and the company could have benefited from proof of concept had the antidepressant's trial results been positive.

For Big Pharma giant J&J, this is a drop in the bucket in light of the below-expected 2014 guidance released early this month, which caused a sell off from investors. J&J is one of the largest health care companies globally and has a highly diversified portfolio of health care products that has kept its price relatively stable in the past. Looking at just its pharmaceutical branch, it has a very healthy pipeline and is riding into 2014 with newer drugs like Zytiga, Xarelto, and Invokana ready to drive sales. Additionally, J&J has a considerable pull for investors with its high dividend yield of ~3% and a commitment to increasing that yield.

<a href=",type:company,id:JNJ,,&calcs=include:true,id:price,,&zoom=1&format=real"><img src="" alt="JNJ Chart" /></a><p style="font-size: 10px;"><a href="">JNJ</a> data by <a href="">YCharts</a></p>

Other novel approaches fail
Other pharmaceuticals have been assessing novel approaches for depression as well to no avail. Shire (NASDAQ:SHPG) recently announced failed Phase III studies for the use of its ADHD medication Vyvanse as an adjunctive treatment for depression. The drug did not meet primary efficacy endpoints in two studies and Shire has pulled the program. Nonetheless, Vyvanse will be filed for binge-eating disorders later this year. Shire's best-selling drug would have only expected an increase in sales of $300 million had it been approved for depression. The bigger significance of the new indication would have been the diversification of Shire's portfolio as the market for ADHD medications is stressed by tightening regulations as well as strong competing medications like Adderall and Ritalin.

Special K – special enough?
Ketamine has been a hot approach for depression as well. Early studies showed that the popular party drug/hallucinogen resulted in rapid response in patients with refractory depression. However, it is complicated by the psychoactive side effects which recreational drug users seek. As a result, pharmaceuticals have been designing ketamine-like substances to eliminate those and other side effects. However, failures have been coming here as well. AstraZeneca's (NYSE:AZN) ketamine-like drug AZD6765 was recently pulled for both safety and efficacy in Phase IIb studies. Johnson & Johnson is in mid-stage trials for a ketamine nasal spray (Esketamine) with fast-track FDA approval, and Naurex will be applying for approval of its own ketamine-like substance, GLYX-13 in 2016 .

The market
Over 30 million people in the U.S. are estimated to suffer with a major depressive disorder, or MDD, in their lifetimes, and clinical depression is only expected to rise, especially as more people with depression begin to get treated. Despite high demand for new antidepressants for refractory patients, depression drugs are notoriously difficult for developers. There are high placebo response rates, making it more difficult for therapeutics to meet the primary endpoint of beating placebo and many past trial failures. Overall, the lessened profitability makes it difficult for pharmaceuticals to invest in R&D for mental health, which certainly contributes to the paucity of new psychiatric drugs coming out of their pipelines.

That being said, there is still hope for antidepressant R&D. Takeda and Lundbeck gained approval for their antidepressant Brintellix in both the U.S. and Europe late last year, and it hit the U.S. markets this past January. However, the mechanism is quite similar to existing antidepressants, targeting predominately serotonin receptors.

J&J adds to the pile of drug failures for antidepressants, particularly those of novel mechanisms. For the individual developers, these failures are not necessarily major setbacks for the overall financial picture of the company – however, it is worth considering the chilling effect this may have on other pharmaceuticals from developing new antidepressants.

A stock with fantastic growth prospects...
Opportunities to get wealthy from a single investment don't come around often, but they do exist, and our chief technology officer believes he's found one. In this free report, Jeremy Phillips shares the single company that he believes could transform not only your portfolio, but your entire life. To learn the identity of this stock for free and see why Jeremy is putting more than $100,000 of his own money into it, all you have to do is click here now.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers