Company overview - Bionomics Limited is a clinical-stage biopharmaceutical company engaged in discovery and development of drug candidates focused on the treatment of central nervous system (CNS) disorders and cancer by using its platform technologies. The Company's segments include Drug discovery and development, and Contract services. The Drug discovery and development segment includes the discovery, development and commercialization of compounds to match a target product profile. The Contract services segment includes the provision of scientific services on a fee for service basis to both external and internal customers. Its product candidates include BNC210, BNC375, BNC101 and BNC105. The Company provides treatments for CNS disorders, such as anxiety, depression and Alzheimer's Disease. Its oncology approach targets cancer stem cell therapies in solid tumors. Its technologies include ionX and MultiCore. It operates in three geographical areas, such as Australia, France and the United States. 

BNO Details

Positive BNC210 Phase 2 clinical trials in Generalized Anxiety Disorder (GAD) patients:Bionomics Ltd (ASX: BNO) reported for positive data from its Phase 2 clinical trial of BNC210, a first in class, negative allosteric modulator of the α7 nicotinic acetylcholine receptor, in patients with Generalized Anxiety Disorder (GAD). The Phase 2 data has the potential paradigm shift for the treatment of anxiety disorders as BNC210 has also outperformed the current standard of care Lorazepam when compared to placebo in reducing anxiety as measured by both imaging and behavioral read-outs. Moreover, the trial of BNC210 has not produced any signs of sedation, memory impairment, addiction or loss of motor co-ordination, side effects which can occur with the use of benzodiazepines such as Lorazepam. BNC210 is a very powerful trial design because each patient is their own control, receiving each of the different treatments under evaluation and it considerably reduces the number of patients needed to achieve statistical significance. Additionally, BNC210 caused significant changes to cerebral perfusion while decreased amygdala activation in response to fearful faces that means both measures of anti-anxiety activity. BNC210 treatment has also significantly reduced anxiety related defensive behavior in the Joystick Operated Runway Task, again out-performing Lorazepam relative to placebo. This shows that BNC210 trial gave well results in both behavioral and neuroimaging tests.

BNC210 Phase 2 clinical trial in GAD (Source: Company Reports)

 
Targeting huge market opportunity with the success of Positive BNC210 Phase 2 clinical trial: The size of the anxiety disorders market is very big as there are 40 million adults in the United States suffering while over 6.8 million of them have chronic GAD. In Australia, about 14% of the population or one in seven people is experiencing an anxiety disorder every year, with 2.7% experiencing GAD and nearly 6% of the Australian population suffering from GAD in their lifetime. Moreover, the anxiety disorders market is estimated to reach US$18.2 billion by 2020, which shows that there is huge market opportunity for BNC210 as well as a potential to make a positive contribution in expanding treatment options in the future. The market for anti-depressant drugs such as Prozac and Effexor currently sells over US$5-7 billion annually.
 

Anxiety and Depression Market (Source: Company Reports)
 
Ongoing Phase 2 PTSD trial enabling exploration of partnership options and pathways for broader BNC210 development: The group is targeting the Post-Traumatic Stress Disorder (PTSD), which is very poorly addressed by current medications. There is high prevalence of PTSD worldwide and there is high off-label usage with unproven or contraindicated treatments. Therefore, BNC210 might represent a potential opportunity to displace the current therapies and expand market. Only two drugs, the antidepressants paroxetine (such as Paxil) and sertraline (such as Zoloft) are approved for the treatment of PTSD but they have not been shown to address the full range of PTSD symptoms while complete remission of symptoms is rare. The prescribing of benzodiazepines for people with PTSD is actively being discouraged in the US because these drugs are related with a higher risk of unexplained death. Meanwhile, BNO is recruiting for a phase 2 clinical trial for evaluating the effectiveness of BNC210 in treating PTSD, and if the good results in this trial are achieved, it would significantly expand the potential applications for the drug. To accommodate a rising number of patients to be recruited, the company is also considering bringing US sites into the trial. BNO wants to maintain the robustness of the trial but do not want the recruitment to lag and risk losing valuable time to commercialization. Over the next few months BNO said that they would update on trial design while issue guidance on the anticipated timeline to complete recruitment and for data read-out. On the other side, BNO made, Merck & Co., Inc. Kenilworth N.J., USA (known as MSD outside the US and Canada) as a strategic collaborator while the company expects that MSD would initiate the first clinical trial, which would start the payment to Bionomics under 2014 License and Research Collaboration Agreement. BNO would get up to US$506 million in upfront, research and milestone payments in addition to royalties on net sales of licensed products. In addition, MSD had invested US$9 million in October 2015 and has also become a shareholder of BNO.
 

Phase 2 PTSD trial (Source: Company Reports)
 
Anticipated Phase 1 trial results from cancer stem cell targeting drug candidate BNC101 in patients with metastatic colon cancer, in Q2/Q3 2017: For cancer stem cell targeted treatment for solid tumors, BNC101 got the acceptance of an investigational new drug (IND) application by the US Food & Drug Administration (FDA). BNC101 is a first in class drug candidate that inhibits a process promoting cancer stem cell survival and proliferation called Wnt signaling. BNO has an initial focus in the development of BNC101 for colon cancer but BNC101 has the potential to target on other LGR5 positive solid tumor types including pancreatic, breast, lung and liver cancer. The phase 1 result is expected by Q2/Q3 of 2017.
 

BNC101 Market Opportunity (Source: Company Reports)
 
Started a Phase 1/2 trial of BNC105 in patients with Chronic Lymphocytic Leukemia (CLL) in 1H, 2017: BNO’s another drug in the oncology pipeline is the vascular disrupting agent BNC105. BNO has collaborated with the Olivia Newton-John Cancer Research Institute to enable the comprehensive evaluation of BNC105 effects on immune cell subsets within tumors. BNO is starting the Phase 1/2 trial of BNC105 in patients with Chronic Lymphocytic Leukemia (CLL) in 1H 2017.
 
Strong cash position to fund further initiatives: BNO has $39.015 million in cash and cash equivalents at the end of September 2016 plus got the R&D tax incentive refund of $8 million in October 2016 to execute its clinical and drug discovery programs successfully. BNO had posted the revenue of $21,727,915 in FY 16 as compared to $16,616,405 in FY 15. On the other hand, BNO’s after tax loss is of $16.6 million on the back of the investment in the clinical development of BNC210 and BNC101 and research on the other pipeline programs. Meanwhile, the group recently reported that they are settling their obligation to US Investors from their December 2015 capital raising program via issuing remaining 16,082,988 warrants. BNO used the US$12 million private placement proceeds from December 2015 for Phase 2 trial of BNC210 funding targeting for patients suffering from post-traumatic stress disorder (PTSD). Rest of the Warrants would be issued under Bionomics’ refreshed placement capacity with a strike price of $0.5938 and a term of five years. BNO would get over $9.6 million in cash after the placement while new shares would comprise over 3.1% of total issued shares plus existing options and warrants outstanding.
 
Stock Performance: BNO stock fell over 10.98% in the last three months but recovered over 7.35% in this year to date (as of January 16, 2017) and this momentum in the stock is expected to continue. BNO’s pipeline for this year includes advancing compounds from Merck & Co. collaboration coupled with clinical trial results for BNC101. Recruiting patients into the clinical trial of BNC210 in patients with PTSD is ongoing while BNO is also open to other opportunities or partnerships. We give a “Speculative Buy” recommendation on the stock at the current price of – $ 0.36

 
BNO Daily Chart (Source: Thomson Reuters)

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