Actinogen (ASX:ACW) has today informed shareholders of its next steps in the clinic and launched a capital raising.

The biotech stock has raised $6 million in a placement and is seeking $4.9 million in a rights issue to fund two clinical trials to begin in the first half of 2021.

Actinogen’s first clinical trial will be against a new indication for its lead drug, Xanamem. The company will conduct a Phase II clinical trial in Fragile X syndrome (FXS) patients.

Fragile X syndrome is a genetic intellectual disability that can cause anxiety, sleep and behavioural problems. The trial will evaluate Xanamem’s safety and efficacy against each of these.

Actinogen says recent scientific advancements in the underlying pathology of FXS and data showing Xanamem inhibits cortisol production supports Xanamem’s potential.

Excessive production of cortisol has been linked to the development and progression of FXS and Alzheimers.

Actinogen also plans to submit Orphan Drug Designation and Rare Paediatric Disease Designation to American regulator, the FDA. If granted, both labels could help speed up clinical development and eventual commercialisation.


Continuing the Alzheimer’s fight

Meanwhile, the second trial will test Xanamem against Mild Cognitive Impairment (MCI) directly caused by Alzheimer’s.

Alzheimer’s is a disease whereby brain cells degenerate and die causing a decline in memory and thinking skills.

Actinogen said today’s deal was primarily to fund the latter study after last year’s Phase 1 results.

CEO Bill Ketelbey said his company looked forward next year’s studies and building on the progress made to date.

Last year Xanamem failed a clinical trial against Alzheimer’s at a 10mg dose, but later on the company found a higher dose (20mg) showed some cognitive improvement.

“The company is committed to advancing Xanamem’s clinical development to find an effective treatment for a number of devastating medical conditions and the upcoming FCS trial expands the potential clinical applications for Xanamem,” Dr Ketelbey said.

Shares had steadily risen since March’s crash. But today they fell 14 per cent because of the discount of the capital raising.

Actinogen (ASX:ACW) share price chart