Redx Pharma (LON:REDX) new management team is continuing to focus its financial resources on progressing lead candidates in oncology and fibrotic disease into the clinic. An extensive internal review, led by the new CEO Lisa Anson 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, a key value inflection point. 2019 is expected to be a busy year for REDX, with several major milestones due. The first of these will be the re-start of the Phase I/II trial with RXC004, its porcupine inhibitor, during 1H’19.
Strategy: REDX is focused on the discovery and early clinical development of small molecule therapeutics in oncology and fibrotic disease. It aims to take assets through proof-of-concept clinical trials and potentially forge partnerships for later-stage development and unlock additional shareholder value.
Pipeline: REDX has a clear vison, a streamlined pipeline focused on high unmet needs in oncology and fibrotic diseases, and also aims to leverage its medicinal chemistry expertise. The company has ambitions to progress first-in-class or best-in-class compounds in biologically validated targets.
Milestones: Management has set some ambitious, but achievable, goals. 2019 will be an important year with the re-start of the Phase I/IIa trial with RXC004. It also aims to nominate one to two development candidates from a portfolio of three fibrosis programmes, with first clinical trials in 2020.
Risks: After a difficult period, REDX has emerged in much better shape. While all early-stage pharma/biotech companies carry substantial risks and are capital- intensive, the rewards can be substantial, as evidenced by the successful disposal of its BTK programme for $40m (£30.5m net) in cash in 2017.
Investment summary: The strengthened management team is moving forward with a revised business plan that focuses cash resources on progressing its drug leads in oncology and fibrotic disease to clinical proof-of-concept. Big pharma is known to be willing to pay substantial prices for novel and/or de-risked assets with clinical data, reinforcing REDX’s strategy and offering the potential to generate significant shareholder value for companies such as Redx Pharma.
