NASDAQ:TNXP
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Business Update
NDA Filing in 2H24; Pre-NDA Meeting in 2Q24
In the second half of 2024, Tonix Pharmaceuticals Holding Corp. (NASDAQ:TNXP) will be filing a new drug application (NDA) for TNX-102 SL (conditionally accepted trade name Tonmya™) for the treatment of fibromyalgia. The filing will be based in part on the positive results from the Phase 3 RESILIENT and RELIEF trials. For an overview of results from the RESILIENT trial see our previous report here and for an overview of the results from the RELIEF trial see our previous report here. We anticipate Tonix conducting a pre-NDA meeting with the FDA during the second quarter of 2024.
Tonix recently made additional announcements in relation to the NDA and commercialization plans for Tonmya. In February 2024, the company announced it has selected Rho, Inc. to support the preparation and planned submission of its NDA. Rho is a global contract research organization (CRO) that provides a full range of drug development services. In March 2024, Tonix announced that it selected EVERSANA® to support the launch strategy and commercial planning of Tonmya, specifically to assess the fibromyalgia landscape and help plan an efficient go-to-market strategy. EVERSANA is an independent provider of global services to the life sciences industry.
As of April 1, 2024, Tonix is now a fully integrated biopharmaceutical company as it has assumed full responsibility for the distribution, selling, and marketing of Zembrace SymTouch and Tosymra along with supply chain, regulatory, and quality control of those two products. We believe that having this commercial infrastructure in place is going to help expedite the launch of Tonmya, if approved.
TNX-1500 Update
While Tonix is fully focused on the NDA and potential commercial launch of Tonmya, the company is continuing to advance its pipeline, which includes TNX-1500 for the prevention of rejection in solid organ and bone marrow transplant and the treatment of autoimmune disease. The company recently announced it has completed the clinical stage of a Phase 1 trial of TNX-1500 in healthy volunteers. Topline results from the trial are anticipated in the third quarter of 2024.
In addition, results from a recent pharmacokinetic (PK) trial in cynomolgus monkeys were analyzed to predict human PK parameters. Single doses of 30, 100, and 300 mg/kg were evaluated and each dose revealed a linear PK, which is consistent with no target mediated drug disposition. The half-life in cynomolgus monkeys was approximately 14 days, and the predicted human half-life was calculated based on allometric scaling for monoclonal antibodies with linear PK (Deng et al., 2011). This supports monthly dosing in humans.
TNX-1500 is a third-generation anti-CD40 ligand (CD40L) monoclonal antibody (mAb) that is being developed for the prevention of allograft rejection, xenotransplantation, and the treatment of autoimmune disease. The CD40/CD40L signaling pathway is involved in the activation of both the innate and adaptive immune response. CD40 is predominantly expressed on antigen presenting cells (APCs) and delivers intracellular activating signals. CD40L, which does not contain any signaling capacity, is found on multiple cell types, including T cells, B cells, natural killer (NK) cells, macrophages, and platelets (Schönbeck et al., 2001). The CD40/CD40L pathway is essential for humoral immune responses to T cell-dependent antigens (Lederman et al., 1992), the production of proinflammatory cytokines (Cella et al., 1996), and generating effective cytotoxic T cell responses (Liu et al., 2013).
TNX-1500 has multiple large potential market opportunities, as shown in the following figure. Tonix will first be targeting prophylaxis of organ rejection in adult patients receiving a kidney transplant. With approximately 24,000 kidney transplants performed each year in the U.S. (NIDDK), the total market size in the U.S. is estimated to be >$5 billion. Sanofi recently announced positive results from a Phase 2 trial of its anti-CD40L mAb frexalimab in multiple sclerosis (M.S.) (Vermersch et al., 2024). Sanofi projects potential peak revenues for frexalimab in M.S. of > €5 billion.
Pipeline Update
Tonix is advancing a number of additional pipeline products through government funding and/or investigator initiated sponsored trials:
TNX-1300 (recombinant double mutant cocaine esterase): We anticipate a Phase 2 clinical trial of TNX-1300 initiating in the second quarter of 2024. In 2022, Tonix was awarded a Cooperative Agreement grant from the National Institutes of Health (NIH)’s National Institute of Drug Abuse (NIDA) to support the development of TNX-1300. TNX-1300 has been granted Breakthrough Therapy designation by the FDA.
TNX-1900 (intranasal potentiated oxytocin): In November 2023, Tonix announced the first patient was enrolled in an investigator-initiated Phase 2 study of TNX-1900 for improving bone health in children with autism spectrum disorder. The trial is being funded by the U.S. Department of Defense (DoD). TNX-1900 is being investigated in three additional investigator-initiated Phase 2 trials: Phase 2 study for binge-eating disorder; Phase 2 study for social anxiety disorder; Phase 2 study for adolescent obesity.
Financial Update
On April 1, 2024, Tonix announced financial results for the fourth quarter and full year 2023. Tonix began recognizing revenue in 2023 due to the acquisition of Zembrace SymTouch and Tosymra. Net product revenues for the fourth quarter of 2023 were approximately $3.8 million and the cost of sales was $2.4 million.
R&D expenses for the fourth quarter of 2023 were $17.1 million, compared to $24.7 million for the fourth quarter of 2022. The decrease was primarily due to decreased non-clinical and manufacturing expenses. G&A expenses for the fourth quarter of 2023 were $11.6 million, compared to $8.1 million for the fourth quarter of 2022. The increase was primarily due to sales and marketing and the transition services expenses associated with the company’s recently acquired marketed products partially offset by a decrease in compensation-related expenses.
For 2023, net product revenues were approximately $7.8 million and the cost of sales for 2023 were approximately $4.7 million. R&D expenses in 2023 were $86.7 million, compared to $81.9 million for 2022. The increase was primarily due to an increase in clinical, manufacturing, employee-related, and professional expenses partially offset by decreased non-clinical and regulatory expenses. G&A expenses for 2023 were $34.8 million, compared to $30.2 million for 2022. The increase was primarily due to sales and marketing associated with the company’s recently acquired marketed products.
As of December 31, 2023, Tonix had approximately $24.9 million in cash and cash equivalents. On March 28, 2024, Tonix announced a securities purchase agreement for gross proceeds of $4.4 million through the sale of 14,666,666 shares of its common stock and warrants to purchase up to an aggregate 14,666,666 shares of common stock at a combined offering price of $0.30 per share and accompanying warrant. The warrants have an exercise price of $0.33 per share. Following the financing, we estimate Tonix has approximately 95.5 million shares outstanding and, when including outstanding options and warrants, a fully diluted share count of approximately 324.5 million.
Conclusion
Tonix is fully focused on preparing the NDA for Tonmya, which we anticipate being filed in the second half of 2024, and building its commercialization footprint in anticipation of a potential approval in the second half of 2025. We believe the company has laid the groundwork for a successful commercial launch of Tonmya (if approved) through the commercialization of Zembrace SymTouch and Tosymra. After taking the recent financing into account, our valuation now stands at $1.40 per share.
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