Awakn Life Sciences Corp. (AWKN:NEO; AWKNF:OTCQB) and Cybin Inc. (CYBN:NYSE American; CYBN:NEO) are best positioned to capitalize on the "robust potential of psychedelics in alcohol use disorder (AUD)," an estimated $20 billion-plus global market, purported H.C. Wainwright & Co. analyst Patrick Trucchio in a September 22, 2022 research note.
"With a potential addressable patient population in Western markets that exceeds 30 million people and with 10% or less of these patients in active treatment, the unmet medical need and opportunity for innovative approaches to treatment is very high," Trucchio wrote. "As such, we believe the potential for psychedelics with therapy to ameliorate AUD could represent a significant opportunity for drug sponsors, which is highly underappreciated by investors."
Two Leaders in the Space To Consider
Trucchio discussed Canada-based Awakn and Cybin, the two publicly traded biopharma companies that have announced AUD as a target indication. He noted both companies are worth an estimated $10 per share, "implying robust upside from current levels."
One of them, Awakn, is pursuing ketamine, an NMDA receptor antagonist, plus psychotherapy in a variety of addiction disorders as well as MDMA plus therapy for AUD.
Over 32 weeks of observation, AUD patients treated with psilocybin plus therapy experienced "robust decreases in [their] percentage of heavy drinking days over and above those produced by active placebo and psychotherapy."
The company's lead clinical program, Project Kestrel, is supported by the Phase 2 trial in which KARE, or ketamine in the reduction of alcoholic relapse, and psychotherapy were administered to 96 patients with severe AUD. In this trial, patients achieved, on average, 86% abstinence at six months post-treatment compared to 2% pre-trial and 25% with the current standard of care.
Next for the program is a Phase 3 trial in the United Kingdom (U.K.), 66% of the costs of which the U.K.'s National Institute for Health and Care agreed to cover. Up to 280 AUD patients will be enrolled, treated, and followed for six to 12 months.
"The study is expected to be the largest ketamine-assisted therapy clinical trial and the only psychedelic Phase 3 trial receiving government funding," Trucchio noted.
The clinical data supporting the use of psychedelics-assisted therapy in treating AUD and the size of the global AUD market bode well for Awakn and Cybin, which are pursuing the opportunity, and for investors in these companies that currently offer upside.
Awakn is also pursuing the use of MDMA plus therapy in AUD. The biopharma will explore a data licensing agreement with the U.S.-based Multidisciplinary Association for Psychedelic Studies, or MAPS, to support Awakn's Phase 2b and planned Phase 3 studies evaluating MDMA-assisted therapy for AUD in Europe.
The second company in the space Trucchio highlighted, Cybin, is currently evaluating deuterated psilocybin, CYB003, as a treatment for major depressive disorder. The biopharma is expected to expand this program into AUD if the Phase 1/2a study, now underway, shows the compound to be safe, well-tolerated, and efficacious. Phase 1 data are due out by year-end, Phase 2a data by mid-2023.
Data Support Use of Psychedelics in Treating AUD
Trucchio pointed out the results of three robustly conducted trials that individually evaluated ketamine (Awakn's Project Kestrel), MDMA (Imperial College London's Bristol Imperial MDMA in Alcoholism, or BIMA, study), and psilocybin (study by Bogenschutz, Ross, Bhatt, et al.) showed a benefit in AUD patients.
"What is consistent in the data is that when administered in the proper set and setting with psychotherapy, psychoactive substances appear to ameliorate the cravings associated with AUD and thus, provide the potential for a significant reduction in heavy drinking days and even abstinence, both of which are approvable regulatory endpoints in the U.S. and Europe," Trucchio wrote.
Results of the Bogenschutz et al. study were just published in JAMA's Aug. 24, 2022 issue. The trial showed that over 32 weeks of observation, AUD patients treated with psilocybin plus therapy experienced "robust decreases in [their] percentage of heavy drinking days over and above those produced by active placebo and psychotherapy."
The clinical data supporting the use of psychedelics-assisted therapy in treating AUD and the size of the global AUD market bode well for Awakn and Cybin, which are pursuing the opportunity, and for investors in these companies that currently offer upside.
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