On Thursday, October 13th Aytu BioPharma issued a press release that reads:
"Aytu BioPharma Announces Strategic Shift to Focus on Commercial Operations and Indefinite Suspension of Clinical Development Programs"
The announcement comes as a disappointment just months after Aytu initiated the clinical trial, pre-enrolling patients and establishing sites across the world to run the exciting study of a vascular EDS treatment. This post describes what we know about why the trial is suspended and what's next for vEDS patients.
Reading the press release, it's clear this is a financial decision to help Aytu become more profitable. The company was planning to invest $20 million in the vascular EDS trial. Given tough financial times, they've decided to hold off on that investment (for now).
Aytu BioPharma is a small, publicly traded company. Over the past 18 months, the stock market has performed very poorly and smaller biotech companies like Aytu have been hit particularly hard. When Aytu acquired the license to AR101 (enzastaurin) in April 2021, Aytu's stock price was $7-8 per share and the company's stock was worth over $160 million in total. Today, Aytu's stock is worth less than $0.20 per share and the value of all of the company's stock is about $10 million in total.
The company's plan has been to get investors to give them money to fund the study. When the company's stock was worth $160 million, getting investors to give them $20 million for the study didn't seem like as big of an investment. Now that the company's stock is worth $10 million, it's much harder to find investors to give them the $20 million. Aytu CEO, Josh Disbrow, stated that they have the "expectation of funding all future clinical development with internally generated cash flow or through partnering". That means they would not need to ask investors to give them money for the study, they could pay for it using the money they already make.
The news is certainly disheartening for those of us excited about the potential for this treatment. Although they slowed down the study in the past, they are now pausing "indefinitely", which adds a lot more uncertainty. But let's try to look at some of the positives:
Aytu (and Rumpus Therapeutics before them) pushed the trial significantly closer to a reality. Just a couple of years ago, this research was a potentially promising study in mice out of Johns Hopkins. As of today, the trial was nearly ready to go, with patients pre-enrolled, sites preparing for a study, many regulatory approvals completed, and the treatment months from being administered to patients. For Aytu (or another pharma company) to finish the trial would require much less work than previously. It's really a matter of the money.
Aytu has stated an intention to continue the study in the future. Although we don't know how far into the future it is, Aytu's CEO stated publicly, "We did not take this pause of our clinical development efforts lightly and intend to revisit the program at the appropriate time."
It's not about interest or awareness anymore, it's about money. Although it feels helpless to think this study probably would be happening already if not for a bad stock market. There's something positive about this. Five years ago, many of us felt like vEDS was such a rare condition we were fighting just for attention. In many ways, we're past that - multiple pharmaceutical companies are targeting vEDS. Although the stock market is hurting their ability to invest today, stock markets rise and fall and when the market returns, we can hope that investing in vEDS will continue to be a priority.
In Mid-November, Aytu will hold its quarterly earnings call where we will hear more about their strategy and plan. We will post again after that announcement to share updates. FIGHT vEDS will continue to work with Aytu to find ways to accelerate this potentially life-saving trial.