Fibrosis is the scarring that happens after the body tries to heal itself following an inflammatory episode. Just like a deep cut heals into a scar, internal cuts at inflammation sites lead to fibrosis, which eventually makes the organ unusable. Healthy people have short and infrequent episodes of inflammation in response to minor infections that are repaired quickly. Cystic fibrosis and scleroderma sufferers have constant inflammation that is self-destructive.
Since both trials are double blinded and placebo controlled, we do not know yet how the drug is performing, but news in April that the Food and Drug Administration (FDA) has allowed the scleroderma trial to continue in a 12-month open-label extension does serve as preliminary evidence of safety and some efficacy. If Resunab were not safe, FDA would not have granted an open label 12-month extension to the trial. This conforms to data from earlier trials where there were no moderate or severe adverse events in 52 patients taking doses of up to 60mg. 71 patients taking doses from 80 to 240mg had no serious side effects either, with the most common symptom being moderate dizziness at 18% of patients. Had the drug not shown any efficacy for any patient at least in their estimation, even given the double-blind nature of the trial, there would be no demand for the extension in the first place.
A confluence of factors could be behind the recent insider buying by Sean Moran, the company’s Chief Financial Officer, and Dr. Yuval Cohen, the chief executive. Moran now holds over 132,000 shares. First of all, with both cystic fibrosis and scleroderma phase 2 results due in just a matter of months, the end of the year is going to be big for the stock. Second, the open label extension grant will start bringing in much more data following the initial release at the end of the year. Third, the markets targeted are especially lucrative, particularly cystic fibrosis that has some of the most expensive drugs in the world. Scleroderma has no treatment specifically designed for it besides general immunosuppression, and Resunab is actually not immunosuppressive. While it does shut down the inflammation, it does not disturb adaptive immunity, keeping immunity active against infection even as the inflammatory response is blocked.