Investment case considerations.16 Jan 2021 13:37
It may come as a surprise to some when I say that your annual flu vaccine has an efficacy of only (circa) 50%. Google it if you do not believe me.
So, when assessing the potential for regulatory approval for Synairgen’s nebulised Interferon Beta, it is worth highlighting here that it does not need to be anything like100% effective. This treatment will have considerable clinical value with a much lower efficacy and, because it showed such promise against the end point parameters set in the Phase 2 trial, 80%, if my memory serves me, I think the current Phase 3 trial stands a ‘better than good’ chance of producing results that will lead to regulatory approval in many countries. Consider also that the recently approved Dexamethasone treatment has shown to reduce mortality only by about one third...and it has side effects.
Phase 3 results should be known by the Summer but may be sooner depending on the speed of recruitment. Also, Synairgen’s Chief Exec said, its SG018 trial has been amended with the regulatory agencies "thereby reducing the number of patients required to complete the placebo-controlled trial from 900 patients to 610". Further, the primary endpoints have been changed to 'time to hospital discharge' and 'time to recovery'. Assessments for Long Covid-19 symptoms have been added, where patients are unable to shake off the effects of the virus months after initially falling ill, on day 60 and 90.
Chief Executive Richard Marsden said: "With this adaptation we should be able to reduce the time taken to complete the trial, which, together with an expedited review from the FDA, could allow us to get this therapy approved for patient use in Covid-19 more rapidly.
Worth noting. Covid-19 will be with us for the foreseeable. Any treatment that prevents hospitalisations, speeds recovery and saves lives will be of immense value in the globally battle against this disease. If Synairgen’s nebulised Interferon Beta treatment proves to be effective for covid-19, it will likely be effective against other viral based respiratory diseases too, including those from influenza. That means a global addressable market is out there well into the future for this treatment, other than just for Covid-19.
If regulatory approval is granted, not only will the share price respond accordingly but I believe Synairgen will be bought out in double quick time by a large Pharma, capable of getting this product to a global market as soon as possible.
As for making an investment choice…..it’s a roll of the dice based on what you know to date verses the probability of a successful phase 3 trial and subsequent regulatory approvals. Regulatory approval will send the share price vertical. Failure will return it to 35p. It is about as simple as that for me. On the basis of what I know to date, I have taken an educated punt that this treatment will be successful in its Phase 3 trials.