Anavex Life Sciences CEO discusses trials of new Parkinson's and dementia drugs

Yahoo Finance's Myles Udland talks with Anavex Life Sciences CEO Christopher Missling about the company's new Parkinson's disease drugs as well as its recent capital-raising stock sale.

Video transcript

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MYLES UDLAND: All right, welcome back to Yahoo Finance Live special reshaping the market, talking about the role that individual investors have had in a number of stocks this year. One of those names is Anavex Life Sciences, a small biotech company recently announcing some big breakthroughs in its efforts to treat Alzheimer's and other neurodegenerative diseases. Stock has been up around 300% so far this year. We're joined now by Christopher Missling, the company's president and CEO. Christopher, thank you so much for jumping on to talk with us this morning about the company. Let's just kind of start with your guys' story and where you sit in the market right now-- billion and a half market cap-- and, sort of, what you guys are working towards in your research.

CHRISTOPHER MISSLING: Right, thank you very much for having me. So we are addressing the large markets in aging, applying precision medicine for both global aging, which includes Alzheimer as well as Parkinson's disease, but also rare diseases, which are catastrophic, like Rett Syndrome. And we've been very successful so far in providing evidence of a precision medicine platform with clinical data in all of these three indications. And we continue with clinical trials as you go.

MYLES UDLAND: And, you know, Christopher, as we've talked about the role that institute-- or the small investors, rather, individuals play in the market. And we've talked as a group about how biotechs in many ways are sort of the original meme names, right? We're making a bet that we can have a product-- that your company can have a product that will, you know, be the next Moderna, for example. We've all seen that example. And I'm curious, as an operator of one of these businesses, you know, how are you-- where your focus is in terms of negotiating both what can happen in the stock market and your stock has had, you know, a number of lives over the years and how you guys day-to-day are trying to work on some of these treatments?

CHRISTOPHER MISSLING: Well, in medicine, you have to really demonstrate evidence. And it requires a very fundamental scientific approach to do that. That's what we are able to do. We've identified a biomarker response. And I think that led to the increase in appreciation because with a endpoint successful that could also be then considered, maybe not as robust, but if you have the endpoint, which is successful improvement of a outcome in patients life that can be associated with a biomarker response which is completely independent that makes the whole story much more consistent and complete the evidence to this. And that's what we able to find and we are very proud about that that we found this unique biomarker response, which is specific to our drug.

MYLES UDLAND: And I'm curious-- I mean, I know we're in the weeds here on the science of it, but from a lay perspective, sort of, where-- like where in your research-- let's maybe is the right way to think about it-- where within the brain are you guys working? Is it within the central nervous system? And how are you approaching, you know, again, I think, Parkinson's, Alzheimer's? Everyone understands that. How are you approaching potential treatments, you know, against those diseases?

CHRISTOPHER MISSLING: You know, these are very different indications. Parkinson is more like the movement impairment. Alzheimer's the cognition. And then Rett syndrome is another effect on a combination of these factors, cognition and movement, which is genetically mostly caused. And we found that in the brain, in the central nervous system there is a constant struggle in these indications, which we call a cellular stress. And this can be alleviated, or reduced, or compensated by a protein called sigma-1 receptor, and we activate that protein. And we can show that this activation can be also tracked with a blood biomarker. And it shows the correlation of the effect of the drug with the increase of this sigma-1 protein in the blood.

CHRISTOPHER MISSLING: Now, Christopher, when I look at your guys' latest investor presentation, I see here, you know, high up establishing an mRNA predictive biomarker of efficacy in Alzheimer's. And, of course, unfortunately, I've, like many people, have learned a lot about mRNA over the last year. And I'm curious, you know, where that fits into what we've all learned with Pfizer's platform and Moderna's in terms of COVID development and if that is indeed the same idea and how you guys are approaching that?

CHRISTOPHER MISSLING: Yeah, very good point. So mRNA is the messenger RNA. It's the determination of our protein gets expressed in the body, which is the functional part of the body, if you so like. And we were able to show that our drug activates the mRNA. So while Moderna brings the mRNA from the outside, we activate the mRNA inside-- in the body by small molecules. So our Anavex 2-73 compound, our drug, is a small molecule you can take one daily orally, like a mini aspirin if you so like.

MYLES UDLAND: Now, when you guys came out with your latest results in May, you mentioned you guys had three years of cash on your balance sheet. In June, you were able to come to market raising $50 million in a private placement deal. By my math that gets you guys to five years of capital on the balance sheet right now. How is that-- you know, what are you thinking about in terms of that runway? And is it the market that was able to get you guys there with that capital raise or is it what you're seeing in your results that really gave you the confidence to go and raise that money?

CHRISTOPHER MISSLING: It was really the interest of the fund, which came in a very blue chip biotech fund-- dedicated biotech fund, who put the entire $50 million to work in a direct investment. And we just where-- you know, we were aware as a biotech company constantly need to have resources to continue to do excellent clinical trial studies. And the stock was moving up positively on-- based on data and that led to the decision to allow this investment to take place to-- in order to have now five years runway as you correctly described.

MYLES UDLAND: Yeah, and that capital raise getting done at $21 a share, right where the stock is trading today. And, Christopher, before we let you go, I do want to ask a little bit also about the grant you guys got from the Michael J. Fox Foundation for your work on Parkinson's and, sort of, where that fits in to the picture as well.

CHRISTOPHER MISSLING: Excellent point. So the Michael J. Fox Foundation awarded us a second grant. It's the-- the first one was to confirm for the first time that Anavex 2-73, our drug, was indeed showing a response in Parkinson's disease. And there was a dose trial, which done in animals, to show disease modification in Parkinson's disease with our drug successfully. And that led to the next investment from Michael Fox to provide us a grant, which is not an investment. It's like a grant without any recourse to now put this to work into a clinical study in Parkinson disease.

MYLES UDLAND: All right, Anavex Life Sciences CEO Christopher Missling. Christopher, I hope we can have you back when you guys have more positive news on your development. Thanks so much for jumping on with us this afternoon.

CHRISTOPHER MISSLING: Thank you very much for having me.