Anavex: New Approach to Alzheimer's

11/01/2016 10:00 am EST

Focus: STOCKS

Tom Bishop

Founder, BI Research

This featured stock is a biopharmaceutical company dedicated to the development of novel drug candidates to treat central nervous system diseases, explains Tom Bishop, small cap growth stock expert and editor of BI Research.

The lead candidate from Anavex (AVXL), known as A2-73, is currently in a Phase 2a clinical trial. It has a clean safety profile that shows promise to halt and/or possibly even reverse the course of Alzheimer's.

A2-73 is also in preclinical testing on Parkinson's with complete funding from the Michael J Fox Foundation. And it has also shown promising preclinical results for the treatment of epilepsy, Rett Syndrome and MS, to name just a few.

Anavex announced that it has signed a material transfer agreement under which Biogen (BIIB) will test Anavex's lead drug candidate, Anavex 2-73 in an oligodendrocyte precursor cell (OPC) differentiation assay for MS.

Biogen's own efforts with Alzheimer's and MS drug development have been disappointing and so they hired a new head of R&D; his goal is to "stock the pipeline with more compounds that could have a big medical impact."

While this relationship is starting in the lab with MS, a focus area of Biogen, this could blossom into something bigger including A2-73 for Alzheimer's, another focus area for Biogen.

Accordingly, getting noticed by a big pharma like this, got investors fired up. This is a big dose of credibility and Anavex is clearly on their radar now.

The day of this announcement AVXL soared 31% to $4.13...on 27 million shares of volume.

So why should A2-73 work when major pharma companies with bigger resources have failed in hundreds of trials? Well, because Anavex is using a different mechanism in the fight.

It is using the body's Sigma-1 receptors which are in the brain and naturally capable of fighting or correcting the process of Alzheimer's, but have for some reason gotten lazy.

So Anavex A2-73 is an agonist that activates the body's own Sigma-1 receptors in the brain to do their job.

I must also say that time and again Dr. Missling has impressed me with his command of the science, his tight control of expenses, his savy business and tactical acumen, his work ethic and his enthusiasm for what they are creating.

I feel very comfortable with his stewardship, which is very important to the success of this story.

While there are certainly no guarantees here, the shares remain a speculative, high-risk Buy for much bigger promise down the road as this story unfolds.

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By Tom Bishop, Editor of BI Research

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