Addiction Therapy Company Secures Major UK Endorsement

It’s already a busy quarter for Awakn Life Sciences Corp. (AWKN:NEO; AWKNF:OTCQB). After The Economist lauded the London, Uk / Toronto, Ontario-based firm as “One To Watch" in 2023, the addiction therapy pharmaceuticals and clinical practices concern announced the investigative study of a novel oral thin-film ketamine formulation designed to make its therapy possible without syringes.

Awakn researches, develops, and commercializes therapeutics for addiction, primarily Alcohol Use Disorder (AUD). Its therapeutics focus on the multi-receptor brain circuits that drive addiction rather than seeking antiquated single-drug receptor targets.

Awakn’s research segment is developing ketamine-assisted and  3,4-Methyl​enedioxy​methamphetamine (MDMA)-assisted psychotherapy tools to treat substance and behavioral addictions, while the delivery segment operates a chain of medical psychedelic clinics across Europe. The company has offices in the UK, Norway, Ireland, and Canada.

The Catalyst: ILAP Authorization

Today, the company announced that it had secured ILAP status for ketamine-assisted therapy for Severe Alcohol Use Disorder, which affects about 70 million people globally. ILAP aims to accelerate time to market, facilitating patient access.

Similar to the FDA’s fast-track program in the United States, this designation, granted by the U.K.’s Medicines and Healthcare products Regulatory Agency (MHRA), provides endorsed producers with access to specialist advice from the MHRA and other UK government partners, including the National Institute of Health and Care Excellence (NICE).

The upshot is that for the remainder of the therapeutic development process, Awakn will have access to faster market authorization, thanks to earlier engagement, enhanced coordination, and monitoring of important product development activities.

ILAP status also allows the UK’s National Health Service (NHS) to adopt potential treatments faster, enabling quicker patient access to these potential medicines.

Dr. Shaun McNulty, Awakn’s Chief Scientific Officer, explained, "We will be able to monetize this project in the UK more rapidly and with significant support from key partners, de-risking actions to marketing."

Awakn CEO Anthony Tennyson explained that “Ensuring our therapeutics reach people who need them most is our key priority as a company. Having an innovation passport gives us the opportunity of working with the regulators to find the most efficient pathway to marketing authorization and ultimately and most importantly to those people who desperately need it."

Celia Morgan, Professor of Psychopharmacology at the University of Exeter, commented that “The award of Innovation Passport status validates the development of our highly innovative therapeutic approach of using ketamine-assisted psychotherapy to treat severe alcohol use disorder and our desire to bring this therapeutic approach to patients as rapidly as possible."

Morgan, who is also Awakn’s Head of Ketamine-Assisted Therapy and has overseen its clinical trials, added that the designation allows the company to “build optimally on the excellent Phase II proof of concept study as [it works] in partnership towards marketing authorization."

“We look forward to working closely with the MHRA, NICE, and partners to accelerate our planned Phase III clinical trial," she concluded. 

Stifel GMP, analyst Andrew Partheniou pointed out that the thin-film formulation announcement "follows a successful Phase II trial that demonstrates [the] efficacy of ketamine for severe AUD, de-risking its outlook. Hence, we reiterate AWKN's attractive profile that we believe is at odds with its ~US$10m valuation."

Dr. Shaun McNulty, Awakn’s Chief Scientific Officer, is pleased that his team has secured ILAP standing. “All credit to Prof. Celia Morgan, with support from Prof. David Nutt," he said in an email discussion regarding the achievement.

He explained that from a sales point of view, “[the] main benefit is for the specific project we applied for, the use of I.V. ketamine to treat severe alcohol use disorder (AUD) in the UK. We will be able to monetize this project in the UK more rapidly and with significant support from key partners, de-risking actions to marketing."

“However, it also provides an additional level of external validation for the innovation and potential of our therapeutic approach to benefit patients. So although the focus of this development is on our ketamine-severe AUD project, it helps to validate our common approach to treating addiction via drug-assisted psychotherapy and develops a regulatory roadmap for this and other projects."

Those roadmaps may be used sooner than expected. McNulty explained: “ILAP acceptance demonstrates strong support from the UK regulatory agency, and this will at least be noted as positive by other agencies. So we believe it will make discussions in other jurisdictions easier for this project."

Why Awakn?

In a January 25 Morning Research Summary for Stifel GMP, analyst Andrew Partheniou highlighted Awakn’s upcoming “study to establish the dissociative effect of a proprietary and patent-pending oral thin film formulation of (S)-ketamine, expected to be completed by Q3CY23."

He explained that “if successful, the study could lead to a global licensing agreement with an  established European pharmaceutical company to then potentially pursue a Phase II trial for mild and moderate Alcohol Use Disorder (AUD)."

Partheniou expects the company to use its connection to the University of Exeter “to explore this value-added activity at an immaterial cost, thus creating interesting optionality given the formulation could open the opportunity to address the 90% of AUD patients who typically do not seek intensive inpatient treatment."

He also pointed out that the thin-film formulation announcement “follows a successful Phase II trial that demonstrates [the] efficacy of ketamine for severe AUD, de-risking its outlook. Hence, we reiterate AWKN's attractive profile that we believe is at odds with its ~US$10m valuation."

Why This Sector?

Psychedelic medicine is rapidly becoming a go-to solution for clinicians tired of outdated therapeutic tools and models that regularly fail patients up to five times or more.

The treatment market is considerable, with 285 million people affected by AUD worldwide. The global AUD treatment market is valued at US$25 billion per annum, but despite this huge spend, therapeutic ‘solutions’ often have relapse rates up to 75%.

Why Now?

One result of the failure of traditional therapies is a loosening of the market for novel substances driven by people determined to medicate themselves — a development with little clinical oversight in some jurisdictions.

For example, in Massachusetts, there are two bills before the house and senate designed to decriminalize psilocybin mushrooms, ayahuasca, mescaline, and ibogaine. If passed, they would end prosecution for possession of psychedelic substances.

The House bill, Bill HD.1450, “An act relative to plant medicine," was filed by Rep. Lindsay Sabadosa, while Senate Bill SD.949, with the same name, was filed by Sen. Patricia Jehlen.

Awakn, like other companies in its field, provides an important interface between the latest scientific advancements in treatment methods with psychedelic substances and the self-directed healing modality prevalent among many healthcare consumers today.

Ownership and Share Structure

Awakn’s management owns 18.82% of the company’s 32,476,187 common shares. Awakn also has 9,049,240 warrants, 2,971,746 stock options, and 35,172 DSUs outstanding for a fully diluted of 44,532,345.

OrbiMed Advisors LLC files as an insider, with a 7.40% equity stake (2,403,550 regular shares) and 989,583 warrants exercisable at prices of CA$1.80 or higher.

According to Reuters, 18.27% of shares are held by institutions and strategic investors, 8.35% by investment managers, and 9.93% by individual investors. Other institutional investors of note include Iter Investments, Palo Santo, Negev Capital, Neo Kuma, TD Veen, JLS, and Ambria. 

Awakn has a market cap of CA$6.91 million, with 32.48 million shares outstanding. It trades in the 52-week range between CA$0.1701 and CA$1.6200.

The company is covered by a myriad of analysts, including the previously mentioned Andrew Partheniou of Stifel, as well as Patrick Trucchio of H.C. Wainwright & Co. Awakn has also been reviewed by Jason McCarthy of Maxim Group and technical analyst Clive Maund of clivemaund.com.

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Disclosures:

1) Owen Ferguson wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. They members of their household own securities of the following companies mentioned in the article: None. They or members of their household are paid by the following companies mentioned in this article: None.

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