Once again, small biotech stocks are making big headlines.
Alterity Therapeutics Ltd [ASX:ATH] is kicking things off this week with some great news. Updating the market on its US patent proceedings, which saw its share price spike 26.92% higher.
That’s a great result for shareholders, but also for victims of neurodegenerative issues. With Alterity working hard on a drug that has proven effective in treating Parkinsonian disorders in animal testing.
So, with any luck, their lead drug ATH434 will be just as helpful for human patients.
Patent secured, more investigation to come
As Alterity reports, they’ve secured 20 years of exclusive rights to 150 pharmaceutical compositions that revolve around ‘labile iron’. An element that has been implicated for its possible links to Parkinson’s, Alzheimer’s, and other brain diseases.
Filed in March, this patent was fast-tracked by the US Patent and Trademark Office (USPTO). Signalling, perhaps, that it could provide a breakthrough for treating these debilitating conditions.
At the very least, Alterity will now have the ability to explore this possibility. Utilising their lead drug (ATH434), as well as any future mixtures from now on. As CEO Geoffrey Kempler notes:
‘This broad patent establishes an excellent foundation for the company to pursue multiple therapeutics across a spectrum of neurodegenerative disease.
‘There is a growing clinical and scientific focus on the implication of elevated iron in the brain of people with neurodegenerative disease. Alterity has been at the forefront of research and drug development in this area, and we have significant research to support our current and future drug development efforts.
‘This patent allows us to fully prosecute these opportunities with confidence in the coming years to address some of the most devastating brain diseases which currently have few or no treatment options.’
Naturally, this is great news for shareholders. Because it gives further credence to Alterity’s ongoing testing and development.
Not that this will necessarily guarantee a favourable outcome. But, at the very least it will give them time to investigate. And right now, that is enough to lift the markets’ optimism surrounding this tiny stock.
What’s Next for Alterity?
While securing this patent is important, what Alterity really needs is trial data.
To date they have only finalised a Phase 1 clinical trial of ATH434. Testing that simply infers whether human patients are safe to take the drug. Rarely do Phase 1 trials provide any noteworthy insight on medicinal response of treatability.
Rather, it is the Phase 2 trials that provide far more insight into the effectiveness of a drug. And that is what Alterity is working towards setting up. Having recently finalised a fresh capital raising of roughly $35 million.
With that money, Alterity will be busy working toward these trial goals. Testing that will really give shareholders an insight into the potential of their drug and ‘labile iron’ prerogative.
Until then though, like any early-stage biotech, this stock is extremely speculative. The kind of investment that could see volatile movement one way or the other depending on said trials.
That shouldn’t surprise anyone though. After all, we are talking about a biotech stock.
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For Money Morning