Friday, December 03, 2010
Unusual for an OTC bulletin board stock, NanoViricides (OTC:NNVC) is valued at over $200 million- not exactly penny stock territory. Even more unusual, this small biotech’s market cap is not supported by a single product in clinical development. Instead, the company’s value lies in its unique antiviral technology, nanoviricides®.The company defines nanoviricides as a specific type of antiviral nanomaterial that is designed to be capable of binding to, encapsulating, and potentially destroying virus particles. To add a bit more detail, it consists of a flexible polymer empowered with ligands that bind to specific sites on a virus. The polymers self-assemble into a micelle that engulfs the virus, rendering it inactive. this process may also lead to the destruction of the virus as forces from attachment of the micelle to the viral envelope lead to viral disassembly.The beauty of this system is its broad applicability across a variety of viral diseases using the same underlying technology. by substituting the ligands, it can be targeted toward specific viruses. this technology also has advantages over traditional direct-acting antivirals through the ability to simultaneously target multiple virus binding sites. by doing so, and at conserved regions less prone to mutation, the nanoviricide presents a higher bar to the formation of resistant clones.The polymer micelle is also capable of carrying a drug payload to its viral target, where upon binding, the drug is released and destroys both the viral protein and genetic material. however, the Company states that it has achieved profound effectiveness levels even without encapsulated drug payloads with its current preclinical candidates.NanoViricides’ entire pipeline is based on this polymer micelle technology, exclusively licensed from TheraCour Pharma, a company controlled by Anil R. Diwan, Ph.D. Chairman and President of NanoViricides. Dr. Diwan is in a position to profit mightily from the development of a successful product- as licensor of the key technology patent, he is entitled to 15% royalties on net sales. of note, TheraCour Pharma has a 24.9% interest in NanoViricides. Nearly all the research conducted by NanoViricides is through collaborators or third party contractors. The company has a skeleton crew of six employees managing research at high caliber institutions including the Southern Research Institute, UC Berkeley, UCSF, and NEOUCOM. Manufacturing is done at Dr. Diwan’s company, TheraCour.there are a total of seven research programs in various stages of pre-clinical development at NanoViricides. Beginning with the most advanced, the projects are influenza, HIV, viral eye diseases, herpes, dengue, rabies, and Ebola. The company believes its flu, HIV, and viral eye disease programs have been well validated and are close to the IND stage. Rabies and Ebola have been de-prioritized due to lack of commercial potential and scarce capital; research will continue as funding allows. FluCide™ is the company’s trade name for its anti-influenza candidate. In its original incarnation, FluCide came in three versions: one for the regular flu, a second for severe flu, and a third for the H5N1 bird flu. all three have now been consolidated into one optimized version applicable to these three severity levels of a multitude of different flu strains as well as the recent H1N1 swine flu. In laboratory tests, the optimized FluCide has been shown to be significantly more potent compared to the current standard of care, Tamiflu® (Roche). Animals treated with FluCide lived more than twice as long as those treated with Tamiflu (18.1 vs. 7.8 days) in a high infection, lethality-oriented study. To understand what this means, consider that doubling of Tamiflu dosage in this model increased the survival time only from 6.3 days to 7.8 days. FluCide is the company’s flagship compound and closest to clinical testing. Encouragingly, the Company says that they have sufficient data to file a pre-IND application with the FDA. so it is a matter of time as to when they get the paperwork in order to enable them to have pre-IND meetings with the FDA. this should help hash out items needed for the company to file a successful IND and get the ball rolling toward a clinical trial. The market for a highly effective influenza treatment could be substantial. there are practically no available treatments for the seasonal flu aside from Tamiflu and Relenza, which may shorten the duration of symptoms by about one day. much of the sales for Tamiflu and Relenza are from government stocking for epidemics such as bird flu and swine flu. Though irregular, these orders can amount to billions of dollars. if approved, FluCide has a good chance of gaining market share due to the limited treatment options. according to Dr. Diwan, FluCide has the potential for use as a prophylactic, i.e. a treatment to be taken so that you do not get influenza. FluCide also has the potential to eliminate the need for influenza vaccinations, which have limited efficacy, and have to be redeveloped every year. Should that be the case, the impact to global healthcare costs would be tremendous.Another promising treatment coming out of the labs is HIVCide™. The HIV market is large, but relatively mature; there have been few truly novel drugs developed to treat this disease lately. because there are no cures for this disease, new, effective treatments have the ability to gain traction even in this highly competitive market. When Merck’s first-in-class integrase inhibitor, Isentress®, was approved in October 2007, the drug was quickly adopted by the HIV community. It is considered to have blockbuster potential.HIVCide has a truly differentiated mechanism of action to all currently available treatments. this alone makes it an interesting candidate. In pre-clinical animal models, the company has shown HIVCide to be as effective as a well-validated HAART therapy of an oral three drug combo: AZT+3TC (lamivudine) + Efavirenz. HIVCide was shown to be safe and well tolerated; it also required a shorter duration of therapy compared to HAART- one week compared to 42 days to achieve this effect. It is possible a longer duration of treatment may improve the outcome further.NanoViricides is also at work on a drug for viral eye diseases and one for genital herpes. Eye drop formulations have been created for the eye disease treatment, and a cream has been formulated for genital herpes. Following a $10 million financing agreement from Seaside 88 LLC, of which the final $2.5 million is due to be received this month, the company anticipates it should have enough cash on hand for the next 18 months. this should be more than adequate to bring one of its many pipeline products into the clinic. The technology is intriguing and pre-clinical data appears good- but investors are anxiously awaiting the first in-human data for full validation.
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