SALT LAKE CITY - Recursion, a clinical stage TechBio company, revealed top-line results from the Phase 2 SYCAMORE trial of REC-994, a drug candidate for symptomatic cerebral cavernous malformation (CCM). The study met its primary safety endpoint and showed promising trends in MRI-based efficacy measures among participants receiving the highest dose.
The SYCAMORE trial was a 12-month randomized, double-blind, placebo-controlled study assessing the safety, tolerability, and exploratory efficacy of REC-994 in patients with CCM. The drug demonstrated a similar safety profile across placebo and both 200mg and 400mg dosage arms, with no significant difference in the frequency and severity of adverse events.
Secondary efficacy endpoints suggested a reduction in lesion volume and hemosiderin ring size at the 400mg dose compared to placebo. However, improvements in patient or physician-reported outcomes were not observed at the 12-month mark. The trial, which was not powered to demonstrate statistical significance, enrolled 62 participants in June 2023, with 80% proceeding to a long-term extension study.
Dr. Jan-Karl Burkhardt, MD, the study's Principal Investigator, and Connie Lee, Psy.D., CEO of the Alliance to Cure Cavernous Malformation, both expressed optimism about the potential of REC-994 to address the unmet needs of CCM patients who currently have limited treatment options outside of surgery.
Recursion plans to engage with the FDA to discuss subsequent studies and intends to present trial data at an upcoming medical conference, as well as submit findings for publication in a peer-reviewed journal. REC-994 has previously received Orphan Drug Designation in the US and Europe.
CCM is a neurovascular disorder characterized by vascular malformations in the brain and spinal cord, leading to seizures, neurological deficits, and possible hemorrhagic stroke. It affects an estimated 360,000 symptomatic individuals in the US and EU5, with a potentially larger undiagnosed population.
Recursion's approach leverages its Recursion OS, a platform that combines biology, chemistry, and machine learning to advance drug discovery and development. The company is headquartered in Salt Lake City and operates globally.
This news is based on a press release statement, and the reported findings are part of Recursion's ongoing efforts to develop therapeutic solutions for CCM and other conditions.
In other recent news, Salt Lake City-based Recursion Pharmaceuticals has been making significant strides in its operations. The company has secured an irrevocable commitment from Evotec SE, a significant shareholder of Exscientia plc, to support Recursion's proposed acquisition of the UK-based company. This brings the total shareholder support for the transaction to approximately 53%. In addition, Recursion has announced a $30 million deal with Genentech, providing a substantial influx of capital and reflecting the progress of Recursion's collaborative efforts in neuroscience.
Analyst coverage has been active, with Jefferies initiating coverage on Recursion Pharmaceuticals, issuing a Hold rating due to the company's current valuation, while acknowledging its potential in the AI-driven drug discovery space. Furthermore, KeyBanc has reiterated its Overweight rating on Recursion Pharmaceuticals, maintaining a $16.00 price target for the company's shares.
Recursion Pharmaceuticals has also announced plans for a public offering of $200 million worth of Class A common stock, led by Goldman Sachs & Co. LLC and J.P. Morgan, though the completion of this offering remains subject to market conditions. Lastly, the company has seen significant changes in leadership, with Dr. Robert Hershberg being appointed as the new Chair of the Board, and Dr. Najat Khan joining the company as its new Chief R&D Officer and Chief Commercial Officer.
InvestingPro Insights
As Recursion (NASDAQ: RXRX) continues to make strides in the biotech industry with its recent trial results for REC-994, investors are closely monitoring the company's financial health and market performance. According to InvestingPro, Recursion holds more cash than debt on its balance sheet, which is a positive sign of financial stability. This could provide the company with a solid foundation to fund ongoing research and development activities without the immediate need for external financing.
Moreover, analysts have shown confidence in the company's potential, as evidenced by two analysts revising their earnings estimates upwards for the upcoming period. This optimism could be linked to the anticipated sales growth in the current year, as highlighted by another InvestingPro Tip. Such growth prospects are often a key driver for investor interest in a company, especially in the high-risk biotechnology sector where future revenue streams are closely tied to clinical trial outcomes and regulatory approvals.
InvestingPro Data further reveals a market capitalization of $2.05 billion for Recursion, which reflects the company's valuation in the market. Despite a negative P/E ratio of -4.41, indicating that the company is not currently profitable, Recursion's liquid assets exceed its short-term obligations. This suggests that the company is in a good position to meet its immediate financial liabilities, an important consideration for investors looking at the company's short-term financial health.
In addition to the insights provided here, there are several other InvestingPro Tips available for Recursion, offering a more comprehensive analysis of the company's financials and market performance. These can be found at: https://www.investing.com/pro/RXRX.
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