REDX Pharma (LON:REDX) is a clinical-stage biotechnology company focused on drugs targeting oncology and fibrotic diseases. An extensive review, led by the new CEO, has reinforced the vision of a streamlined pipeline in these two disease areas, with the aim of progressing drug candidates to deliver clinical proof-of-concept. Progress in the fibrotic programme is going apace, with the recent announcement that RXC006 has been nominated as REDX’s first anti-fibrosis development candidate. The strong pre-clinical evidence behind this decision was presented for the first time on 29 November at the 2nd anti-fibrotic drug development summit in Cambridge, MA.
Strategy: REDX is focused on the discovery and early clinical development of small molecule therapeutics in oncology and fibrotic disease. It is also focused on taking assets through proof-of-concept clinical trials and then partnering them for late-stage development and commercialisation.
Idiopathic pulmonary fibrosis (IPF): IPF is a chronic and progressive fibrotic disorder of the lung that typically affects adults over the age of 40, with median survival in the US estimated at three to four years after diagnosis. There is a real medical need, as no treatments are available to stop or reverse the disease.
RXC006: In its oral and poster presentations, REDX disclosed for the first time its drug development candidate RXC006, an orally bioavailable porcupine inhibitor that had demonstrated encouraging results in suppressing Wnt pathway involvement in fibrosis in different in vivo disease models, of the lung, kidney and liver. REDX aims to enter the clinic during 2020.
Risks: REDX has emerged from fiscal 2018 in a clean position, with a focused strategy. The company has cash runway into 2Q’19 and will therefore require investment for clinical trials for its pipeline of porcupine and ROCK inhibitor development programmes.
Investment summary: New management is moving forward with a revised business plan that focuses cash resources on progressing its drug leads in oncology and fibrotic disease to proof-of-concept studies. Big pharma has been shown to pay substantial prices for good science and novel and/or de-risked assets with such clinical data, reinforcing REDX’s strategy, potentially generating good returns and enhancing shareholder value.
