Awakn Life Sciences Corp. (AWKN:NEO; AWKNF:OTCQB), the U.K.-based healthcare and biotech/psychedelic repurposing company, focuses its efforts on repurposing psychedelics to treat addictions such as alcohol use disorder (AUD) and gambling disorder (GD) — with its primary focus on AUD.
Maxim Equity Research's Jason McCarthy wrote, "Considering that private addiction treatment comes with a 70%-80% fail rate and treatment can cost north of $30K, the opportunity for Awakn to improve this model is significant."
If you’ve been following the biotech and psychedelic market, you’ve noticed the drop over the past year. Just look at the SPDR S&P Biotech ETF (XBI:NYSE.Arca) — which reveals a year-over-year dip of 35.82% for the overall industry.
But here’s what the drop in the SPDR S&P Biotech ETF doesn’t reveal . . .
AUD Treatment a Lucrative Market
The global AUD treatment market (an essentially untapped market) is valued at US$25 billion by HC Wainwright’s Patrick Trucchio, with current AUD treatments revealing a devastating 75% relapse rate.
Meanwhile, Awakn’s leading clinical development program, Project Kestrel, shows an 86% abstinence rate six months post its ketamine-assisted therapy versus 2% abstinence prior to the trial, and 25% in the current standard of care, making this treatment 3.5x more effective than current AUD treatments.
"The unmet medical need and opportunity for innovative approaches to treatment is very high," said H.C Wainwright’s Patrick Trucchio.
One of the most widely used medications to treat AUD is Alkermes' (ALKS:NASDAQ) Vivitrol, which works by essentially mediating or blocking the endorphin release during alcohol consumption, but as we touched in our July 11th article, "it has reported side effects like high blood pressure, infections at the point of injection and even erectile dysfunction."
Director and Co-Founder of Awakn Anthony Tennyson told Streetwise Reports in that article that Awakn's "lead development program is proprietary therapeutic of ketamine and psychotherapy together to treat AUD. The results of our Phase 2 B trial for this program were up to three times better than the current standard of care." You can read more about why Awakn believes Ketamine is the solution here.
Still, the current standard of care continues to make a lot of money, with Vivitrol sales hitting US$343.9 million in 2021 from US$310.7 million the previous year.
In a September 1, 2022 report, Maxim Equity Research Analyst Jason McCarthy wrote, "Considering that private addiction treatment comes with a 70%-80% fail rate and treatment can cost north of US$30K, the opportunity for Awakn to improve this model is significant."
Awakn Hires Alkermes' Expert
Awakn also has no issue learning from those before, hiring the senior regional sales director of Alkermes, Kevin Lorenz, to work as Awakn's head of commercial development. Lorenz has over 20 years of experience working in the biotech industry.
Technical Analyst Clive Maund also set his sights on the biotech and rated Awakn as a Strong Buy in an August 16, 2022, post.
According to The Dales Report, Lorenz "was responsible for half of the U.S. sales of Vivitrol . . . worth US$170m per annum."
At the announcement of the decision, Tennyson commented that Awakn is "delighted to have someone of Kevin’s caliber, an industry leader in his field, join our organization. Having the right person with the right network to launch and scale a part of our business that has immense potential was a critical decision. "
Lorenz will bring the commercial business of Awakn to The United States, this will start with the launch of its Licensing Partnership business., which according to Yahoo Finance, is "expected to generate revenue for the second half of 2022."
Awakn Hitting Unmet Need
H.C Wainwright’s Patrick Trucchio noted in late September, "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 . . . 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."
Stifel analyst Andrew Partheniou said, "The launch of the partnership is in line with Awakn's Q3/22 guidance and demonstrates good execution."
In an October 4, 2022, report, Trucchio reiterated a Buy rating on Awakn Life Resources with a US$10.00 price target. This is a 3233.33% increase from the current price of US$0.30.
Technical Analyst Clive Maund also set his sights on the biotech and rated Awakn as a Strong Buy in an August 16, 2022, post.
The company currently has two revenue streams: Awakn-operated clinics (two located in the UK and one in Norway) and licensed partnerships with U.S. addiction treatment clinics.
Just a few months ago, the company landed two major partnerships in the same week with Knoxville, Tenn.-based Revitalist Lifestyle and Wellness Ltd., one of the largest publicly listed U.S.-based ketamine wellness-clinic chains.
At this time, Stifel analyst Andrew Partheniou said, "The launch of the partnership is in line with Awakn's Q3/22 guidance and demonstrates good execution."
The company also scored a partnership in Canada with Wellbeings® Pain Management and Dependency Clinic (Wellbeings), and more expansion is just around the bend.
Near-Term Catalysts: Expansion, Expansion, Expansion
On October 25, the company announced that it secured CA$775K from TD Veen, a family-owned, Norwegian investment company and current shareholder of Awakn. The funds will be used to expand its operations in Norway.
According to the news release, the company will use the funds to grow its current Oslo clinic, but also Awakn plans to use funds to open another new clinic in Trondheim, making it the second clinic in Norway.
The recent funding gives nostalgic feelings of the CA$2.5 million the company secured in late July from the UK to cover 66% of Phase 3 trials of Project Kestrel. Now that Phase 2 is complete, the company is currently progressing toward Phase 3.
The Phase 3 trial will be led by Professor Celia Morgan, Awakn’s Head of Ketamine-Assisted Therapy and Professor of Psychopharmacology at the University of Exeter.
New Deal With Nushama
The keyword is expansion. Awakn also scored another major deal with Nushama, a leading network of ketamine-assisted therapy centers. Per the new licensing agreement, Awakn will allow Nushama practitioners to access proprietary therapeutics and training. For each share per treatment, Nushama will pay Awakn revenue; Nushama will also pay the company an annual fee.
Awakn's protocol at Nushama is for a one-time fee of US$12,500, which is vastly different from the average rehabilitation centers, which range nationally from US$20,000 to US$65,000 per month and start at US$50,000 in NYC.
Anthony Tennyson, the Awakn CEO, commented that he is "very excited to partner with Nushama and their exceptional team."
Ownership, Coverage, and Share Structure
Awakn management (which boasts the likes of ex-key players of Gilead and Pfizer, to name a couple) currently owns 21.22% of the stock, with ownership from major institutions too.
Namely, Orbimed Files, as an insider, owns 2,403,550 shares (8.35%). Other institutional holders include Iter Investments, Palo Santo, Negev Capital, Neo Kuma Ventures, TD Veen, JLS, and Ambria.
The company is currently covered by Jason McCarthy of Maxim Group, Andrew Partheniou of Stifel, Matthew Pepler of Canaccord Genuity, and previously mentioned Patrick Trucchio of H.C. Wainwright & Co. As mentioned, newsletter writer Clive Maund also reviews the stock. Click "See More Live Data" in the data box above to see more.
Awakn has a market cap of CA$6.97M and 26.92M shares outstanding, with 16.42M in the public float.
The company on NEO stock has a 52-week range of CA$0.29–CA$3.35. Synchronically, Akawn on OTC pink slips have a 52-week range of US$0.1701–US$2.7100.
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1) Nikia Wade and Katherine DeGilio wrote this article for Streetwise Reports LLC. They or members of their household own securities of the following companies mentioned in the article: None. They and members of their household are paid by the following companies mentioned in this article: None.
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