Clinical-stage biopharmaceutical company Xenon (XENE) is currently the talk of the town, with its announcement of positive results from the Phase 2 “X-TOLE” trial for XEN1101. The drug was tested as a supplementary treatment for adult focal epilepsy patients.

So much has it impressed investors, that its share price skyrocketed to close almost 102% higher at the end of yesterday’s trading session.

Management at Xenon said that XEN1101 displayed “a statistically significant and dose-dependent reduction from baseline in monthly focal seizure frequency when compared to placebo.”

The drug remarkably fulfilled all primary and secondary seizure reduction requirements during the course of three doses. The 35% reduction in the levels of seizure frequency at 25mg doses was noteworthy. This response was significantly above other that of anti-epileptic drugs (AEDs) like ezogabine and Xcopri. Additionally, XEN1101 was well-tolerated, with fewer side effects compared to other AEDs.

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On October 4, Needham analyst Serge Belanger reaffirmed a Buy rating on the stock and raised the price target to $48 from $25 “to reflect the significant de-risking of the XEN1101 epilepsy program.”

Belanger believes that various parameters combined, including high efficacy levels and low side effects, provide a billion-dollar sales opportunity for XEN1101. “We expect XEN1101 to become part of the epilepsy treatment paradigm and achieve peak sales in the $1 billion range,” explained the analyst.

As part of its next steps to success, Xenon is set to meet the FDA as part of a Phase 2 protocol. At the meeting, the company is likely to push for X-TOLE to be considered as one of the two critical trials required for drug approval.

Moreover, two Phase 3 trials for XEN1101 are still in the pipeline, and will be completed before the drug is released in the market as a focal epilepsy treatment. These trials will ensure that the drug meets the requirements for both FDA and EMA (European Medicines Agency) for approval.

Additionally, a Phase 2 trial of XEN1101 for major depressive disorder is also likely to commence before the year ends. The XEN1101 is also anticipated to be tested to treat other epilepsy conditions, demonstrating the versatile potential of the drug. “We expect XEN1101 will now garner significant interest from larger CNS players involved in epilepsy,” said Belanger, talking about other companies engaged in developing treatments for various CNS (central nervous system) conditions.

The Wall Street consensus is optimistic, with a Strong Buy rating, based on 7 unanimous Buys. The average Xenon price target of $44.33 indicates an upside potential of 40.7%.

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Disclosure: At the time of publication, Chandrima Sanyal did not have a position in any of the securities mentioned in this article.

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The post Billion-Dollar Opportunity for Xenon appeared first on TipRanks Financial Blog.

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By: Chandrima Sanyal
Title: Billion-Dollar Opportunity for Xenon
Sourced From: blog.tipranks.com/billion-dollar-opportunity-for-xenon/
Published Date: Tue, 05 Oct 2021 13:55:21 +0000

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