AFT Pharmaceuticals (ASX: AFP) has undertaken analysis of its study examining its medicine Pascomer as a topical treatment for facial angiofibromas (FA) associated with Tuberous Sclerosis Complex (TSC).
The study showed Pascomer delivered statistically significant [p<0.05] benefits against the clinically relevant IGA1, FASI and patient-physician improvement scales.
However, the medicine did not reach the threshold on the IGA scale that the US Food and Drug Administration (FDA) considered necessary for its registration in the United States (US) as a treatment for FA.
AFT also announces its Pascomer development partner and US licensee Timber Pharmaceuticals has terminated its agreements with AFT.
AFT will now take over funding the remaining development work for the orphan drug indication of Pascomer in addition to any non-orphan indications. It will also take over the commercialisation programme in North America. Germany’s Desitin Arzneimittel GmbH continues as the licensee for the FA orphan drug indication in Europe, Switzerland and UK.
AFT Managing Director Dr Hartley Atkinson said neither the clinical study results, nor the change in the medicine’s licensing, development and commercialisation arrangements, are expected to diminish the $12.5 million carrying value of AFT’s Pascomer assets.
While the Pascomer trial did not deliver results that meet the FDA’s thresholds, the medicine continues to show promise in the treatment of this rare and distressing disease,” Dr Atkinson said.
“We also continue to believe Pascomer has good potential for non-orphan indications, which combined may offer markets larger than those for FA in TSC and we therefore plan to continue to progress the development of the medicine.
“As previously noted, there were always significant uncertainties associated with both the conclusion of the present Phase II/III clinical trial and the successful registration of Pascomer with orphan status. It was for these reasons that we adopted a conservative valuation of the Pascomer assets.”
Dr Atkinson also said the new research, development and commercialisation arrangements would be well accommodated within the company’s existing overall research and development budget, signalled in May 2022 at ~ $12 million for the 2023 financial year.
“We see a growing potential to expand our R&D pipeline. In the current environment, many cashflow negative research healthcare companies are finding it difficult to fund their R&D programmes. AFT’s positive cashflows position the company well to undertake such projects either alone or in partnership with others.”
He said Timber Pharmaceutical’s termination of the licensing agreement had been a possibility since a competitor, Japan’s Nobelpharma, secured FDA approval for a treatment for FA. The FDA’s decision effectively blocked Timber Pharmaceuticals’ entry into the US market for seven years with Pascomer as an orphan drug for treatment of FA.