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Here's Why Anavex Life Sciences Corp. (NASDAQ:AVXL) Is Running And What's Next

Here's Why Anavex Life Sciences Corp. (NASDAQ:AVXL) Is Running And What's Next
Written by
Chris Sandburg
Published on
October 30, 2017
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During the middle of last week, Anavex Life Sciences Corp. (NASDAQ:AVXL) bottomed out on a two-day decline that saw it fall from highs of around $5.10 at the week's open to a touch above $4.00 flat on Wednesday.That's a more than 20% decline and, what's more, it came in the absence of any real fundamental or operational developments from the company. AVXL Daily ChartAs the week drew to a close, however, things started to pick up. The company put out a release detailing some fresh data and – on the back of the release – saw a surge in volume and a parallel rise in its share price. At the close of play on Friday, $4.00 flat had turned into $4.25 – a close to 7% run from lows.So why the excitement and where does the company go from here?For anyone new to Anavex, this is a biotechnology company that's working to develop a new class of treatment for neurodegenerative diseases, with an initial (and primary) focus on Alzheimer's disease. Alzheimer's is one of those indications that's notoriously difficult to treat and efforts to do so have led to a whole host of potentially promising assets being discarded pre-commercialization. In this regard, Anavex is working against some tough odds. At the same time, however, the company is approaching the disease in a way that no other entity has tried so far and early stage data has shown to reinforce the idea that this approach might finally be the one that brings about a long needed fresh treatment option for patients in this space.The drug that underpins the company's Alzheimer's program is called Anavex 2-73 and it's designed to target what's called sigma-1 receptor, which in turn is supposed to be able to bring about cellular homeostasis in the brains of patients with this disease. Increased homeostasis should – in theory – slow or halt the degradation of the brain cells that characterize Alzheimer's disease.So why the recent jump?Well, the company has a pretty extensive clinical program ongoing right now, with the drug being tested in a large population of Alzheimer's sufferers. However, alongside this program, the company has also been running a couple of other, early stage programs in an attempt to demonstrate that the sigma receptor-based mechanism of action can be applicable to other disease – specifically, multiple sclerosis and Parkinson's. Just as with Alzheimer's these are really tough diseases to treat and the current standards of care in both spaces are designed to ease symptoms, as opposed to tackle the disease's underlying cause.The news that hit press on Friday was that the company has been able to show that Anavex 2-73 might be able to promote what's called remyelination in MS sufferers. In patients with MS, the body attacks the myelin sheath that protects nerve cells, which in turn causes the symptoms associated with the disease. If Anavex 2-73 can promote the repair of this myelin sheath, it could be a game changer for the space.Further, this week, we got the news that the company also has some fresh data related to the Parkinson's disease program and that it's set to present said data today at the Michael J. Fox Foundation’s Parkinson's Disease Therapeutics Conference taking place at Convene Midtown East, New York City. In this instance, the drug seems to promote the restoration of what are called dopamine axon fibers, the loss of which is brought about by the condition.The two bits of data are similar, then, in the sense that Anavex 2-73 seems to be capable of neuro-regeneration in these patients – something that should (in theory) also be broadly applicable to the primary indication of Alzheimer's.That's why the company is running.Keep in mind that these data are early stage and – again – these are all tough conditions to target. With that said, however, the lack of treatments in these spaces means that a company only needs its trial data to hint at the efficacy of one of its programs to get an excitable response from markets.Check out our previous coverage of this one here. We will be updating our subscribers as soon as we know more. For the latest updates on AVXL, sign up below!Image courtesy of NIAID via FlickrDisclosure: We have no position in AVXL and have not been compensated for this article.

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