Biotech Stock On The Radar: vTv Therapeutics' Diabetes Pipeline

The thinly traded micro-cap biotech vTv Therapeutics Inc VTVT is on investors' radars ahead of a Sept. 18 poster presentation of clinical data.

The company is set to present at the European Association for the Study of Diabetes 55th annual meeting with results from the Part 1 of the Phase 2 Simplici-T1 study of liver-selective glucokinase activator TTP399 as an adjunctive treatment for Type 1 diabetes.

The Pipeline

vTv has six products in its clinical pipeline, with three Phase 2 assets: azeliragon for Alzheimer's disease, TTP399 for Type 1 and Type 2 diabetes and TTP273 for Type 2 diabetes.

Azeliragon

Azeliragon, codenamed TTP488, is an orally administered, small molecule antagonist targeting the receptor of advanced glycation endproducts, or RAGE.

RAGE is an immunoglobulin-like cell surface receptor that overexpresses in Alzheimer's disease. It is presumed to be an important cellular cofactor that binds ligands implicated in multiple factors of Alzheimer's, including Aβ transport into the brain, the phosphorylation of tau, chronic inflammation, vascular dysfunction, metabolic dysregulation and neurotoxicity.

The company is prepping for the initiation of an adaptive Phase 2/3 study in mild Alzheimer's disease patients with Type 2 diabetes.

"We believe this study is critically important, as confirmation of azeliragon in this AD subgroup is assessing patient improvement as measured by ADAS-cog14, a scoring tool that assesses the level of cognitive dysfunction in AD patients, as well as delayed word recall, maze, and digital cancellation tasks in milder AD patients.," H.C. Wainwright analyst Vernon Bernardino said in a note.

Today's treatment options for Alzheimer's alleviate symptoms of the disease, rather than the underlying cause, and therefore cannot prevent disease progression. 

If approved, vTv sees azeliragon being used as a treatment option for a narrower patient group with Type 2 diabetes.

Since the mechanism of action of azeliragon is complementary to the current standard of care as well as other drugs in development, there is an opportunity for co-administration.

Incidentally, the company faced a setback last year with azeliragon in the broader Alzheimer's disease population, although subsequent post-hoc subgroup analysis of the phase 3 STEADFAST study identified a population that experienced a positive benefit.

TTP399

TTP399 is an orally available liver-selective activator of glucokinase enzyme, a key regulator of glucose metabolism. Once the enzyme is activated, glucose utilization increases and blood glucose levels are in turn lowered.

TTP399 is being developed as a new potential oral anti-diabetic, or OAD, for the treatment of Type 1 and Type 2 diabetes. It provides intensive glycemic control without inducing significant hypoglycemia.

If approved, the company sees competition from other OADs such as DPP-4 and SGLT-2 inhibitors.

In June, vTv announced positive results from the primary analysis of Part 1 of the study. Eight patients treated with TTP399 showed a statistically significant mean reduction in HbA1c of 0.6% at 12 weeks from the baseline compared to a 0.1% increase for the 11 patients treated with a placebo.

The treatment arm also showed decreased insulin usage compared to the placebo. A responder analysis showed that there was a greater proportion of responders — 75% — in the treatment arm than in the placebo group (9%).

A responder is defined as a patient who had:

• A decrease in HbA1c at Week 12.
• No abnormal lactate or ketones detected in blood or urine during the study.
• No increased time in Level 2 hypoglycemia, defined as blood sugar less than 54 mg/dl.

Additionally, abnormal ketones were observed in plasma or urine in 63% of patients on placebo compared to 13% of patients treated with TTP399.

"These results from a small group of patients with Type 1 diabetes are very exciting. If they hold up in part 2 of the trial, TTP399 will be the most impressive adjunctive therapy to insulin in Type 1 diabetes care," Dr. John Buse, principal investigator of the study, said in a statement. 

In Type 1 diabetes, oral non-insulin agents in development that may compete with TTP399 include SGLT-1/2 inhibitors such as sotagliflozin, which is being developed by Lexicon Pharmaceuticals, Inc. LXRX; SGLT-2 inhibitors such as AstraZeneca plc AZN's dapagliflozin; and Eli Lilly And Co LLY and Boehringer Ingelheim's empagliflozin.

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Upcoming Key Milestones

European Association for the Study of Diabetes 55th annual meeting presentation: 7:15-8:15 a.m. ET on Sept. 18.

Top-line results from Part 2 of the Phase 2 Simplici-T1 study: first quarter of 2020.

Top-line results from the Phase 2 study of Azeliragon in mild Alzheimer's disease patients with Type 2 diabetes: end of the fourth quarter of 2020.

Financials

The company hasn't yet generated revenue from product sales, but has derived revenue from collaboration and licensing agreements.

 

Source: 10-K filing

R&D expenses accounted for about 71% of the total operating expenses in fiscal year 2018.

As of June 30, 2019, the company has accumulated deficit of $217.6 million.

The company's liquidity sources include $1.5 million it held as cash and cash equivalents as of June 30, 2019; $7 million of remaining funds available under the Letter agreements; and amounts due under its license agreements with Newsoara BiopharmaJDRF International.

The liquidity position, excluding the amount due from its licensing agreement, will allow the company to meet its liquidity requirements into the third quarter of 2019, vTv said in its latest 10-Q filing.

Stock Performance

Since closing the debut session on July 30, 2015 at $10.89 at a discount to the IPO price of $15, vTv shares have been on a broader downtrend with occasional uptrends.

On April 10, 2018, the stock slumped about 78% after it reported Part A of the Phase 3 study that evaluated azeliragon in Alzheimer's did not meet the co-primary endpoints. In the next session, the stock reached an all-time low of 65 cents before rebounding.

Subsequently, the stock found occasional strength, with incremental stock purchases by the company's biggest shareholder — MacAndrews & Forbes, owned by billionaire investor Ronald Perelman — lending support.

Source: Y Charts

The stock has found near-term support around the $1.27-$1.29 area, which, if violated, could take the stock down to the lows around 65-75 cents reached in September 2018 as well as July 2018.

On the upside, the 200-day SMA, currently at $1.769, could serve as an overhead resistance.

H.C. Wainwright has a $5 price target for the shares of vTv. TTP399 represents $2 of the firm's price target, the analyst firm said in a note.

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