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When it comes to strokes, there is a saying: time is brain.
During a stroke, blood vessels are blocked and blood carrying essential oxygen cannot make it to brain cells. This lack of oxygen kills 1.9 million brain cells every minute. That is why time is brain.
Sadly, globally, only 35% of patients suffering from an acute stroke arrive at hospital in the critical 4.5 hour window for treatment. As such, stroke researchers around the world are focused on shortening the time to treatment. For example, Victorian Health is trialling a mobile stroke unit.
Argenica Therapeutics are approaching this problem slightly differently. Rather than trying to get the patient to hospital within the 4.5 hour window, they’ve asked: how can we widen that 4.5 hour window?
From that question comes their neuroprotective drug: ARG-007.
This 007 doesn’t have a licence to kill. Quite the opposite. It is designed to slow the effect of hypoxia (lack of oxygen) in the brain and reduce the amount of brain cells killed as a patient is rushed to hospital.
The origins of ARG-007
ARG-007 started as a research project of Professor Bruno Meloni and Clinical Professor Neville Knuckey at the University of Western Australia and the Perron Institute for Neurological and Translational Science.
Argenica Therapeutics was created to commercialise this research. In June 2021, it was listed on the ASX (ticker: AGN) to access the necessary capital to develop and commercialise the drug.
A primer on clinical trials
For a drug to be approved by Australia’s Therapeutic Goods Administration (TGA) and the U.S Food and Drug Administration (FDA) it must go through 3 phases of clinical trials. For neurological drugs, the phases include:
- Phase 1: Small trials with only a few healthy volunteers focused on determining the safety of the drug and any potential side effects
- Phase 2: A slightly larger trial in patients with the target indication, up to 100 patients, that continues to assess safety and starts to assess the effectiveness of the drug in comparison to a treatment already in use and/or a placebo
- Phase 3: A larger confirmatory trial, sometimes more than 1,000 patients spread across different clinical sites and different countries, that compares the new treatment with the currently best available treatment (if one exists), and usually with a placebo. It aims to find out how well the drug trial works either in combination with existing treatment or if it is better than existing treatment.
Argenica commenced Phase 1 trials for ARG-007 in 2022 and successfully completed it in December 2022.
The results, reported to the market in May 2023, showed that “all doses of ARG-007 administered were safe and well tolerated with no dose related findings noted for any of the evaluated safety parameters.”
Given the success in Phase 1 trials, Argenica was given approval to commence Phase 2 clinical trials, which would involve the dosing of acute ischaemic stroke patients. The company kicked off these trials in early 2024.
In April 2024, the company updated the market and shared that it had successfully dosed its first 5 patients as part of its Phase 2 clinical trial. What was pleasing for the company is that “no serious adverse events or adverse events related to the dosing of patients have been reported”. After the initial 5 patient data was reviewed by the Data Safety Monitoring Board (DSMB), they recommended the study continue with no modifications required to the Study Protocol.
For Argenica’s Phase 3 trial, the company would be unlikely to commence it alone. It has indicated it could either licence ARG-007 for stroke to a larger pharmaceutical group capable of carrying out Phase 3 trials and commercialisation, merge with or be acquired by a company seeking to enhance its product offerings, or enter into a co-development partnership to jointly advance the drug through a Phase 3 trial.
Beyond Australia
Pharmaceutical companies must get regulatory approval in each jurisdiction they want to sell their drug in. So while Argenica will work to get TGA approval in Australia, they are focused on preparing to go through the clinical trial process in the United States to get Food and Drug Administration (FDA) approval. For stroke, Argenica plans on filing an investigational new drug (IND) application with the FDA later this year, which will allow the Company to run later stage clinical trials in stroke in the US
Further, Argenica is looking to progress other indications through clinical trials, and announced good news on that front in March 2024, when it informed the market that the FDA has granted ARG-007 ‘Rare Pediatric Disease Designation’ (RPDD) for the treatment of Hypoxic Ischaemic Encephalopathy (HIE) in newborn term infants. This designation gives Argenica greater guidance from the FDA as they navigate the clinical trial process in HIE in the United States and also offers the potential for seven years of market exclusivity in the US following approval.
Gaining regulatory approval in the United States will still be a long process. But it is always good to see that regulators see merit in your drug.
The potential use cases for ARG-007
While ARG-007 is currently in Phase 2 trials for stroke patients, the company believes the future use cases of the drug could extend well beyond stroke patients.
A look at Argenica’s financials
Currently, Argenica is not making any revenue from selling ARG-007. As is the case with all pharmaceutical companies that haven’t yet received approval to sell their drug, Argenica must go through its 3 phases of clinical trials before it can sell the drug.
As such, the only revenue it earns are from R&D tax incentives, government grants, donations and interest on its cash balance.
In the meantime, Argenica is reliant on investors to fund its operations. When it IPO’ed in 2021, it raised $7 million from investors. Since then, it has demonstrated a successful fundraising operation, completing a $5.5m placement in 2022 and a $4m placement in 2023, and more recently completed a $12m placement in April 2024 to ensure the Phase 2 stroke trial was fully funded, and other indications could be progressed.
For that reason, despite making a loss every year in its operation it has reported a growing cash balance year after year.
The future of Argenica Therapeutics
Every 19 minutes someone has a stroke. In 2019, that was 13 million people globally.
One in four people will suffer a stroke in their lifetime and only 10% will recover almost completely. The biggest reason why patients don’t completely recover is the extent of brain cell damage due to a lack of oxygen to the brain.
This is a massive challenge and if Argenica is successful in navigating the 3 phases of clinical trials, they could massively improve stroke patient outcomes.
As investors, the key consideration is how much it will cost for Argenica to navigate these trials and what the company could look like if it is successful.
If Argenica is able to take ARG-007 through these trials, it has been clear it would like to on-sell and licence ARG-007 to another pharmaceutical company rather than manufacture the drug and sell it directly.