Athira's Alzheimer's Trial Fails, Stock Drops

Athira Pharma's journey through the challenging landscape of Alzheimer's disease research has hit a significant roadblock. The latest phase 2/3 trial for their drug, fosgonimeton, did not achieve its primary or key secondary endpoints, resulting in a sharp decline in the company's stock price. The Washington-based biotech company had previously gained attention in 2020 by raising substantial funds through an $85 million series B round and a subsequent $204 million. However, the optimism surrounding the company was short-lived.

In 2021, then-CEO Leen Kawas was accused of manipulating images in various papers, a scandal that led to her departure from Athira later that same year. Adding to the company's woes, it reported phase 2 trial failures in Alzheimer's and dementia in 2022 and 2023. The phase 2/3 trial was seen as an opportunity to redeem fosgonimeton and improve its public perception. Unfortunately, the study's outcomes did not provide the needed boost, causing Athira's share price to plummet by 73% to $0.76 in premarket trading—far below the levels seen after the Kawas scandal and a stark contrast to its post-IPO peak of over $30.

Investors abandoned the stock after Athira could not demonstrate that fosgonimeton effectively improved Alzheimer's outcomes. The trial involved 312 participants with mild to moderate Alzheimer's who were not on acetylcholinesterase inhibitors, comparing 26 weeks of daily subcutaneous fosgonimeton injections to a placebo. The Global Statistical Test, which combined cognitive assessments (ADAS-Cog11) and functional evaluations (ADCS-ADL23), showed that fosgonimeton was no better than the placebo, leading to the trial missing its primary endpoint. Additionally, fosgonimeton did not outperform the placebo on either the ADAS-Cog11 or ADCS-ADL23 scales.

Despite these results, Athira stated that ADAS-Cog11 and ADCS-ADL23 “directionally favored fosgonimeton treatment,” although the differences were not statistically significant. Specifically, the cognition scale showed a nonsignificant difference of 0.70, and the function score showed a 0.67 difference. The most notable divergence between the treatment and placebo groups was observed in prespecified subgroups of patients likely to progress faster, such as those with moderate disease and APOE4 carriers.

Javier San Martin, M.D., Athira's Chief Medical Officer, suggested that the lack of clinical decline in the placebo group, coupled with the short duration of the study, might have affected the trial's ability to demonstrate fosgonimeton's efficacy. During a webinar in June, Athira CEO Mark Litton noted that historically, ADAS-Cog11 and ADCS-ADL23 scores decline by about two points over six months. The absence of such decline in the placebo group led Athira to conduct post hoc analyses on patients with worse baseline cognition to seek signs of efficacy.

Athira contended that the overall data indicates that positive modulation of HGF signaling could be beneficial in treating neurodegenerative diseases. This perspective is particularly significant for ATH-1105, another HGF modulator Athira is developing for amyotrophic lateral sclerosis (ALS). The results of the fosgonimeton trial may have broader implications for the future development and potential success of ATH-1105 in ALS.