Aldeyra Therapeutics Inc. (ALDX:NASDAQ), "to maximize approval chances," opted for a single primary endpoint, that of Schirmer's test, in the Phase 3 TRANQUILITY-2 trial of its 0.25% reproxalap ophthalmic solution (reproxalap) for dry eye disease, reported BTIG analyst, Dr. Thomas Shrader, in a May 24 research note. Aldeyra is developing treatments for various immune-mediated diseases.
Shrader also noted Aldeyra is trading at about US$2.85 per share, but BTIG's target price on it is multiples of that, at US$29 per share. This difference implies a significant potential return for investors.
Aldeyra "represents an attractive and derisked investment opportunity ahead of its first new drug application filings around mid-2022," wrote Shrader.
For BTIG, which rates the U.S. biopharma Buy, Aldeyra "represents an attractive and derisked investment opportunity ahead of its first new drug application filings around mid-2022," wrote Shrader.
As for Aldeyra's endpoint decision for TRANQUILITY-2, the options it did not choose are:
1) two endpoints, Schirmer's test, and eye redness
2) consideration of redness only if Schirmer's is positive.
Prior clinical trial results likely influenced Aldeyra, noted Shrader. Specifically, Schirmer's was highly positive in TRANQUILITY-1, but the redness was not. Redness was only positive in the smaller Phase 2 trial.
"Redness is important to patients, but the recent computer-aided redness evaluation of TRANQUILITY-1 is likely publishable and then can be distributed to physicians," Shrader noted.
The seeming motivation behind the company's single endpoint move, Shrader purported, is to eliminate the potential for an alpha split and achieve a "label that physicians are used to (Schirmer's) and also with a secondary publication package that suggests the drug could do more."
In other news, regarding Aldeyra's systemic RASP, or reactive aldehydes, modulator ADX-629, recently announced systemic data "looked good to us and better than the intended exercise in signal seeking," reported Shrader. Psoriasis was the indication that showed the most promising results over asthma and over COVID-19. Data suggested most psoriatic patients benefitted.
Upcoming catalysts for Aldeyra, Shrader pointed out, include topline data from TRANQUILITY-2 in Q2/22 and new drug application filing for reproxalap in mid-2022.
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Disclosures For BTIG LLC, Aldeyra Therapeutics, May 24, 2022
Analyst Certification: I, Thomas Shrader, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.
I, Sung Jun Hong, hereby certify that the views about the companies and securities discussed in this report are accurately expressed and that I have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report.
Company–Specific Regulatory Disclosures: BTIG LLC expects to receive or intends to seek compensation for investment banking services in the next 3 months from: Aldeyra Therapeutics (ALDX).
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