Advancing Novel Antibody Therapeutics for Neurodegenerative Diseases

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Healthcare

Biotechnology

ProMIS Neurosciences Inc.

Investment Appraisal
ProMIS Neurosciences is advancing three programs for the treatment of Alzheimer&#8217;s disease, amyotrophic lateral sclerosis (ALS) and Parkinson&#8217;s disease. These neurodegenerative diseases represent a multibillion dollar opportunity for ProMIS, which has developed a unique technology to target &#8220;Disease Specific Epitopes&#8221; on the molecular surface of proteins and toxic oligomers. The Company has developed a portfolio of antibody therapeutics designed to target these &#8220;Disease Specific Epitopes&#8221;. The lead antibody PMN310, is slated to commence human clinical trials for the treatment of Alzheimer&#8217;s disease.
Review of Recent Developments
Detection of antibodies specific to SARS-CoV-2. On April 15, 2020, ProMIS announced a collaboration with Dr. Hans Frykman, CEO of BC Neuroimmunology Lab, and his team to develop a high-throughput, highly specific serological assay to accurately detect the presence of antibodies against SARS-CoV-2, the virus causing Covid-19 disease. For the industry, the development of a sensitive and specific assay to detect antibodies against SARS-CoV-2 has been challenging due to significant cross-reactivity to other viruses in the coronavirus family. ProMIS&#8217; team has experience engineering peptide epitopes such as the ones present on the surface of SARS-CoV-2, which could be utilized to develop specific antibodies without cross-reactivity. 
Developing intrabodies using gene therapy vectors &#8211; &#8220;vectorization of therapeutic antibodies&#8221; &nbsp;
On April 9, 2020, ProMIS announced a publication on the journal &#8220;Neurology&#8221; on data from studies on the use of antibodies specifically designed to target toxic oligomers derived from &#8220;alpha-synuclein&#8221; and &#8220;TDP-43&#8221; in experimental models of Parkinson&#8217;s disease and ALS, respectively. Parkinson&#8217;s disease is a neurodegenerative disorder characterized by tremors and impairment of motor functions. In normal neurons, alpha-synuclein regulates neurotransmitter release in the neuronal synapse. In Parkinson&#8217;s disease, the formation of prion-like toxic oligomers derived from alpha-synuclein are thought to be the causative agents responsible for the loss of neurons seen in patients (Frontiers in Neuroscience 2016, 101, 408). 
Amyotrophic lateral sclerosis (ALS) is the most common motor neuron disease (Neurotherapeutics 2015, 12, 352-363). Famous baseball player, Lou Gehrig, was diagnosed with ALS in 1939. ALS is a neurodegenerative fatal condition manifested by rapidly progressive muscle weakness, loss of motor neurons, leading to paralysis and death due to respiratory failure within one to five years after start of symptoms (J Exp Med 2012, 209, 889-893). The prevailing medical hypothesis is that ALS is caused by prion-like toxic oligomers derived from TDP-43 (TAR DNA binding protein) (Nature Communications 2018, 9, 4220). &nbsp;&nbsp;
ProMIS plans performing research to develop intrabodies (intracellular antibodies delivered via gene therapy vectors) for the treatment of Parkinson&#8217;s disease and ALS. These candidate therapeutics will target toxic oligomers of alpha-synuclein and TDP-43, the causative agents of Parkinson&#8217;s and ALS, respectively. We believe the vectorization of therapeutic antibodies is of paramount importance for the industry as it will allow these novel candidate medicines to circumvent the blood-brain barrier, while specifically recognizing intracellular targets. This vectorization approach for therapeutic antibodies is a desired strategy for the treatment of neurodegenerative diseases such as Parkinson&#8217;s and ALS. 
PMN310 is a candidate antibody therapeutic for the treatment of Alzheimer&#8217;s disease 
ProMIS is developing PMN310 for the treatment of Alzheimer&#8217;s disease. PMN310 is designed to target toxic oligomers of amyloid beta, which behave and propagate like prion molecules in the brains of patients suffering from Alzheimer&#8217;s disease. In preparation for the commencement of Phase I clinical trials with PMN310, ProMIS is conducting, in collaboration with &#8220;Toronto Memory Program&#8221; (a memory clinic), a pilot longitudinal study to assess levels of blood-based biomarkers in Alzheimer&#8217;s disease. The trial is being executed in collaboration with Parexel, a global leader CRO for studies of neurodegenerative diseases. Results from this study will be utilized as the historical control arm for ProMIS&#8217; Phase I clinical trial with PMN310. Blood-based biomarkers could expedite development of candidate drugs for the treatment of Alzheimer&#8217;s disease. By detecting changes in patterns of neuronal injury in Phase I clinical trials, ProMIS expects to demonstrate the potential efficacy of PMN310 in early clinical development. Among various biomarkers to be evaluated, levels of &#8220;neurofilament light chain&#8221; (Nfl) will be an important predictor of neuronal injury (JAMA Neurol 2017, 74, 557-566), which will be measured in 100 Alzheimer&#8217;s disease patients monthly for a period of six months. The data will then be compared to Alzheimer&#8217;s patients to be treated with PMN310 in planned clinical trials. 
Before the advent of blood-based biomarkers such as Nfl, the industry had to rely on ADAS-COG and &#8220;Clinical Dementia Rating &#8211; Sum of Boxes&#8221; (CDR-SB) end points, which could not provide reliable data until Phase III clinical trials. At present, ProMIS Neurosciences has the opportunity to monitor efficacy of PMN310 from Phase I clinical trials, much earlier in development, as the Company could measure axonal injury with Nfl biomarker. Other blood-based biomarkers include &#8220;neurogranin&#8221; (Brain Res 2010, 1362, 13-22) and SNAP-25 (&#8220;synaptosomal-associated protein 25&#8221;) (Alzheimer&#8217;s Research &amp; Therapy 2018, 10, 80), which measure synaptic degeneration and neuronal loss. The prevailing medical hypothesis is that synaptic loss and dysfunction precedes neuronal loss in the brain of Alzheimer&#8217;s patients, correlating with the degree of memory impairment. In our opinion, the rate of synaptic dysfunction, axonal injury and neuronal loss will precede changes detected with traditional end points such as ADAS-COG and CDR-SB. This represents a significant advantage for ProMIS Neurosciences relative to other competitors in the area, which did not have access to these blood-based biomarkers in the past. 
Reiterating Outperform rating 
We value ProMIS Neurosciences using a risk-adjusted discounted cash flow model based on a WACC of 13.6%. We used a probability estimate to reflect financial, clinical and regulatory risks. ProMIS has an EV of $26 million. In our opinion, the full value of the Company&#8217;s product and technologies are not reflected in the current share price. We believe that ProMIS has a unique technology, with applications in large markets including Alzheimer&#8217;s, Parkinson&#8217;s and ALS. In our view, the vectorization of therapeutic antibodies to augment efficacy, circumvent blood-brain barrier and target intracellular toxic oligomers has significant potential. We believe this could attract a big pharmaceutical company to sign a high value partnership with ProMIS, which could act as a positive catalyst for the shares. We are reiterating our Outperform rating and $1.00 target on the stock.

ProMIS Neurosciences Inc. (ARFXF)

Advancing Novel Antibody Therapeutics for Neurodegenerative Diseases

Fundamental Analysis:

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Advancing Novel Antibody Therapeutics for Neurodegenerative Diseases (ARFXF)

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