TENX: 3Q Start to Pulmonary Hypertension Trial

By John Vandermosten, CFA

NASDAQ:TENX

READ THE FULL TENX RESEARCH REPORT

Second Quarter 2018 Review

In January, Tenax Therapeutics, Inc. (TENX) announced its plan to advance the development of levosimendan for Pulmonary Hypertension associated with Heart Failure and preserved Ejection Fraction (PH-HFpEF). This announcement was followed shortly after by the installation of a scientific advisory board chaired by Stuart Rich, M.D. A reverse stock split occurred in February, followed by the publication of data supporting the use of levosimendan in PH. Positive news was released on April 4 when the FDA announced that the Phase II clinical protocol that is in effect for levosimendan can be used for the PH-HFpEF indication. This clears the pathway for a 3Q:18 start to the Phase II trial. In the last month of the second quarter, Tenax named its new CEO, Anthony DiTonno, who will lead the company through the regulatory process. Over the last two months, the news front has been quiet as Tenax has prepared for site activation, approved sites through the IRBs, prepared the CRO and made arrangements with vendors. In the very near term databases will be completed and screening will start. Tenax has planned an investigator meeting for October.

As expected, Tenax reported no revenues in the second quarter of 2018. Research and development costs rose sequentially to $0.3 million as preparations for a Phase II trial targeting PH-HFpEF ramp up for a 3Q:18 launch of enrollment. This compares to $1.2 million in the same prior year quarter. The year over year change was due to lower clinical and preclinical expenditures as the LEVO-CTS trial wound down in 2017. General and administrative expenses totaled $1.6 million, a 12% decline. Lower personnel and legal & professional costs contributed to the contraction. These changes were offset by an increase in other costs such as travel, supplies and insurance. Net loss for the period was ($1.9) million or ($1.29) per share.

Cash balance was $6.7 million and cash burn in the quarter was ($1.2) million. The company continues with no debt.

Trial Design

In April the FDA allowed Tenax to submit their Investigational New Drug (IND) application under the existing clinical protocol for levosimendan. The agency also also addressed the company’s questions and provided guidance on the upcoming Phase II. This announcement allowed for a timely IND submission and prepares for enrollment in 2H:18. Substantial safety work has been performed on Levosimendan, negating the need for another Phase I trial. The FDA recognized that there are no approved drug therapies to treat PH-HFpEF patients and acknowledged this may allow a limited Phase III clinical program. Tenax will provide additional detail on the implications of a limited Phase III study at the End-of-Phase II Meeting for PH-HFpEF.

Based on details provided in the corporate presentation and on clinicaltrials.gov (NCT03541603), we anticipate the study will be a double-blind clinical trial enrolling less that 40 PH-HFpEF patients in 20 sites, which should last 14 to 18 months. Enrollees will have a pulmonary arterial pressure (PAP) equal to or greater than 35, a pulmonary capillary wedge pressure (PCWP) equal to or greater than 20, a cardiac index (CI) of less than or equal to 2.2, a left ventricular ejection fraction (LVEF) of over 40 and be NYHA Class IIb or III.

The primary endpoint of the study will be a change from baseline PCWP with bicycle exercise at Week 6. Expected secondary endpoints will relate to a change in resting PCWP under a variety of conditions, a change in resting & stressed CI, change in pulmonary vascular resistance (PVR) at rest & under stress, a global assessment at week six based on the Likert scale and length of exercise period, a physician’s assessment of functional class and clinical events, including death and hospitalizations.
Based on management commentary and what has been accomplished in pre-clinical and clinical work to date, infusion for several hours one time per week appears to be the most likely dosing regimen; however, this will be confirmed in Phase II work.


View Exhibit I – Phase II Study Design

Milestones

‣ Meet with FDA for Phase II Trial Design – 1Q:18
‣ Complete Phase II Design – 2Q:18
‣ Begin Trial Enrollment – 3Q:18
‣ Conduct Comprehensive Strategic Alternative Review – 2018
‣ Raise Capital – 2H:18

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