What happened
Shares of biopharma outfit Anavex Life Sciences (AVXL -1.92%) are up 17.2% as of early afternoon following a trial update for its flagship therapy ANAVEX 2-73. The drug, also called blarcamesine, prompted marked improvements in the cognitive capabilities of Parkinson's disease patients.
So what
ANAVEX 2-73 is Anavex Life Sciences' flagship project, in phase 3 trials as a therapy for Rett syndrome and Alzheimer's disease. Monday's jolt, however, was sparked by encouraging progress in the phase 2 trial of the treatment of Parkinson's disease dementia. In effect, the drug's use correlates with nearly a 19% relative improvement in movement disorder linked to Parkinson's, easily surpassing the "meaningful clinical change" standard.
Notably, dementia patients who were given ANAVEX 2-73 saw measurable increases in the activation of sigma-1 receptors. This is the second such study to demonstrate a correlation between activated sigma-1 receptors and diminished Parkinson's dementia symptoms, suggesting Anavex's developmental efforts are properly targeting the underlying conditions of the disease.
Image source: Getty Images.
Now what
The biopharma company will be submitting its findings to the U.S. Food and Drug Administration for feedback, likely anticipating that the trial will advance to phase 3 tests. If phase 3 goes as well as phase 2 trials have this far, ANAVEX 2-73 will then be submitted to the FDA for a final approval of the drug.
For shareholders, however, big moves like this one are difficult to trade. The stock is now up nearly 200% from May's low, largely in anticipation of today's update. With nothing else to add to the story, a "sell the news" outcome is more than a little possible -- at least in the near future.
