Anavex Life Sciences Corp. (NASDAQ:AVXL) surged higher with a sharp opening gap on news of its testing deal with Biogen Inc (NASDAQ:BIIB).
Trading over 27 million shares, Anavex closed the day with a flourish – up 31.53% at $4.13.
At one stage, the stock was as high as $4.88, but gave up some of those gains in the latter half of the trading session.
Anavex listed on the NASDAQ in October 2015 after a 1-for-4 reverse stock split. It is a clinical-stage biopharmaceutical company developing drug candidates to treat Alzheimer’s disease, other central nervous system (CNS) diseases, pain, and various types of cancer.
Anavex Life Sciences Corp. (NASDAQ:AVXL)’s lead drug candidate, Anavex 2-73, to be tested by Biogen
Under a material transfer agreement, Biogen will test Anavex’s lead drug candidate, ANAVEX 2-73 in an oligodendrocyte precursor cell (OPC) differentiation assay.
Human neurons are surrounded by an insulating layer called a myelin sheath. In CNS diseases such as multiple sclerosis, this myelin sheath is broken down, a process known as demyelination. When the myelin sheath is so damaged, nerve impulses slow or even stop, causing neurological problems.
“These studies will examine the therapeutic role ANAVEX 2-73 may play in permitting remyelination in the brain,” said Christopher U. Missling, PhD, President and Chief Executive Officer of Anavex, in a press release announcing the arrangement with Biogen.
ANAVEX 2-73, is currently in a Phase 2a clinical trial for Alzheimer’s disease. Anavex has also received a research grant to develop ANAVEX 2-73 for the treatment of Parkinson’s disease to fully fund a preclinical study.
Shareholders in Anavex Life Sciences Corp. (NASDAQ:AVXL) breathe easier
Anavex shares were on the mat in July this year after the company announced disappointing 31-week results from the phase 2a study of the same Anavex 2-73 drug.
All of those losses remained intact until mid-September, when the stock touched a 52-week low of $2.43.
Given that situation, suffering shareholders will be glad that the stock is now up 70% from that low.
The Biogen deal gives no financial details, however, and it is only a testing deal – it can’t guarantee the drug’s eventual success, if any.