Entering the clinical stage

The new Board & Management team of Redx is focusing its financial resources (ca.£12.5m) on progressing its lead candidates in oncology and fibrotic disease into the clinic. The company has announced recently that the first patient has been treated with RXC004, a porcupine inhibitor indicated for a number of tumour types, in a Phase I/IIa proof-of-concept clinical trial. By entering humans, Redx has hit an important development milestone and evolved into a clinical-stage biopharmaceutical company. The group’s strategy was validated in 2017 by the successful disposal of its pre-clinical programme BTK for $40m.

• Strategy:  Redx focuses on the discovery and early clinical development of small molecule therapeutics in oncology and fibrotic disease. It is also focused on taking assets through proof-of-concept clinical trials and then partnering them to the drug major(s) for late-stage development and commercialisation.
• RXC004:  Porcupine inhibitors target the Wnt pathway, an embryonic signalling pathway that is implicated in many survival cellular functions, including the maintenance of cancer stem cells.  RXC004 is a specific small molecule inhibitor being used in the clinic in an oral, once-daily formulation.
• Proof-of-concept trial:  Redx has announced that the first patient has been dosed with RXC004 in a Phase I/IIa trial. Initially, the safety and tolerability of RXC004 will be assessed, with headline data expected in late 2018. This will be followed by an expansion arm focusing on gastric, biliary and pancreatic cancers.
• Risks:  After a difficult period, Redx has emerged in much better shape. While all early-stage pharma/biotech companies carry substantial risks and are capital- intensive, the rewards can be substantial, as evidenced by the successful disposal of its BTK programme for $40m in 2017.
• Investment summary:  Redx had already started the process of refining its strategy, but the new management team has simply accelerated this process. The revised business plan is focusing cash resources on progressing its drug leads in oncology and fibrotic disease into early clinical development. The commencement of clinical trials represents an important value inflection point.