BioXcel Therapeutics (BTAI) is banking on artificial intelligence to gain a second speedy Food and Drug Administration approval. The possibility could drive BTAI stock higher.
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The neuroscience industry is riddled with failures. Even in surer areas of drug development, it can take a decade or longer to bring a new medicine to market. But BioXcel did it in under four years with a drug called Igalmi, thanks to its use of AI. Igalmi treats agitation associated with schizophrenia and bipolar disorders.
Now, the company says it hopes to do the same to tackle so-far untreatable cancer. It’s also in late-stage testing of Igalmi as an at-home treatment for agitation tied to schizophrenia or bipolar.
“It’s almost a lifetime goal that we got here,” Chief Executive Vimal Mehta told Investor’s Business Daily. “Our goal was to bring drugs to the marketplace in a faster way with a higher probability of success, a reduced timeline and bringing in new capital efficiency.
Today, BTAI stock has a promising Relative Strength Rating of 93. This puts shares in the top 7% of all stocks when it comes to 12-month performance, according to IBD Digital.
BTAI Stock: AI In Drug Development
The FDA approved Igalmi last year. BioXcel believes it is the first — and only — company to gain a regulatory approval for a drug discovered using AI.
Put another way, Igalmi wouldn’t exist without BioXcel’s AI platform.
BioXcel started out with a question: How do you treat the symptoms of agitation in patients with some neurological disorders? The company’s machine learning program looked at the underlying biology of the disease and found an allele in the brain to block. An allele is a form of a gene.
Then, BioXcel used its platform to search for drugs to block that allele. It eventually found a drug called dexmedetomidine. Pfizer (PFE) sells a branded version called Precedex. It’s used as a sedative before surgery.
“A lot of learning happens because this drug has been in patients and publications,” Mehta said. “We took advantage of all of that for Igalmi.”
Transforming An Older Medicine
Though dexmedetomidine is available as a generic, it’s an intravenous medicine. BioXcel created a sublingual version for Igalmi. Sublingual drugs are dissolvable oral tablets. So, the company has its own set of patents protecting it from generic rivals.
“We took something that already existed and wrote a new chapter on it,” Mehta said.
BTAI stock initially skidded following Igalmi’s approval. But the biotech stock has enjoyed a strong run in the 13 months since then, according to MarketSmith.com. Then shares pulled back more than 13% on March 9 after BioXcel reported $238,000 in sales of Igalmi. That was below expectations ranging from $667,000 to $1.1 million, Mizuho Securities analyst Graig Suvannavejh said in a note to clients.
Igalmi must be given under the supervision of a health care provider. But BioXcel is also testing the drug as an at-home treatment for schizophrenia and bipolar disorders. It’s also looking at Igalmi in agitation tied to Alzheimer’s disease and as a treatment for depression.
In a late April filing, Suvannavejh said BioXcel will have the results for Igalmi in depression and at-home treatment of schizophrenia or bipolar agitation in May. Next month, the company will have test results for Igalmi in Alzheimer’s disease agitation.
These readouts will “provide points for potential stock inflection,” Suvannavejh said in another note.
Another Chance For BTAI Stock To Shine
Meanwhile, BioXcel subsidiary, OnkosXcel Therapeutics, is working on a treatment for patients with a form of prostate cancer that worsens following a round of chemotherapy. BioXcel is in the process of spinning out OnkosXcel with an initial public offering.
The company tested the prostate cancer drug, dubbed BXCL701, in combination with Merck‘s (MRK) Keytruda.
Overall, 25% of patients had a complete response, meaning their tumors completely disappeared. Another one in five patients had a partial response. That means their tumors shrank. Mehta says generally just 3%-5% of patients with this form of prostate cancer response to Keytruda alone.
Patients continued to respond to treatment for a median of more than six months.
“This cancer doesn’t have any approved therapy,” Mehta said. “People use platinum-based therapies. People live for a few weeks to months. Now, we are bringing hope with our drug that can help these patients.”
But BTAI stock fell 1.5% on Feb. 13, the day BioXcel released the results. Mizuho’s Suvannavejh says the effectiveness appeared to diminish in this study. Previously, patients responded to a median of more than nine months and a third of patients had a complete response.
However, that’s because there were more patients in the study and newer…
Read More: BTAI Stock: How BioXcel Is Embracing AI In The Next Drug Evolution