Why Anavex Life Sciences Shares Are Up 17% Today

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What happened

Shares of biopharma outfit Anavex Life Sciences (NASDAQ:AVXL) are up 17.2% as of early afternoon following a trial update for its flagship therapy ANAVEX 2-73. The drug, also called blarcamesine, prompted marked improvements in the cognitive capabilities of Parkinson’s disease patients.

So what

ANAVEX 2-73 is Anavex Life Sciences’ flagship project, in phase 3 trials as a therapy for Rett syndrome and Alzheimer’s disease. Monday’s jolt, however, was sparked by encouraging progress in the phase 2 trial of the treatment of Parkinson’s disease dementia. In effect, the drug’s use correlates with nearly a 19% relative improvement in movement disorder linked to Parkinson’s, easily surpassing the “meaningful clinical change” standard.

Notably, dementia patients who were given ANAVEX 2-73 saw measurable increases in the activation of sigma-1 receptors. This is the second such study to demonstrate a correlation between activated sigma-1 receptors and diminished Parkinson’s dementia symptoms, suggesting Anavex’s developmental efforts are properly targeting the underlying conditions of the disease.

Rising chart punching through the of a computer monitor.

Image source: Getty Images.

Now what

The biopharma company will be submitting its findings to the U.S. Food and Drug Administration for feedback, likely anticipating that the trial will advance to phase 3 tests. If phase 3 goes as well as phase 2 trials have this far, ANAVEX 2-73 will then be submitted to the FDA for a final approval of the drug.

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For shareholders, however, big moves like this one are difficult to trade. The stock is now up nearly 200% from May’s low, largely in anticipation of today’s update. With nothing else to add to the story, a “sell the news” outcome is more than a little possible — at least in the near future.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.



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View more information: https://www.fool.com/investing/2021/06/28/why-anavex-life-sciences-shares-are-up-17-today/

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