XanaMIA study reaches key milestone
On 30 June, Actinogen announced that its ongoing 36-week XanaMIA Phase IIb/III study assessing lead candidate Xanamem (emestedastat) in patients with biomarker-positive
AD (as determined through elevated levels of phosphorylated Tau-181, or pTau-181, at baseline) has recruited its 100th patient. The patient has passed
all screening tests and is scheduled for randomisation and treatment in July.
This is a key milestone for the programme as it confirms that the company is on track
to report a pre-planned interim efficacy (futility) analysis in early Q126, as this
assessment will begin once the 100th study participant reaches 24 weeks of treatment.
With the enrolment of the 100th patient now complete, the 24-week visit ‘trigger’
to commence the interim data analysis on these participants will occur in late December
2025. The trial’s data monitoring committee (DMC) is expected to review all interim
data in January 2026 and perform the required statistical and data analyses. Subsequently,
the results of the interim (futility) analysis will be reported by the company.
| Exhibit 1: XanaMIA Phase IIb/III study overview |
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| Source: Company presentation, June 2025. Note: NIA-AA, National Institute of Aging;
CDR-SB, Clinical Dementia Rating Scale - Sum of Boxes. |
As a reminder, this Phase IIb/III study is designed to enrol c 220 mild-to-moderate
AD patients (with elevated blood levels of pTau-181 at baseline), predominantly across
sites in the US and Australia. Study patients are being randomised to take Xanamem
10mg or placebo once daily for 36 weeks. The primary endpoint is the drug’s effect
on AD progression using the FDA-recognised Clinical Dementia Rating – Sum of Boxes
(CDR-SB), a comprehensive scale of functional capacities. The CDR-SB scale was used
as the primary endpoint to support the FDA approval of Eisai and Biogen’s Leqembi
(lecanemab) in AD.
We note that XanaMIA’s study design was supported by a subset analysis reported in Q422 among patients with elevated pTau-181 at baseline from Actinogen’s
XanADu study (n=185) in patients with AD. This analysis showed statistically significant
improvements versus placebo on the CDR-SB scale in this group.
| Exhibit 2: XanADu study results in high pTau-181 patients |
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| Source: Company presentation, June 2025 |
As reported in a 2024 publication in the Journal of Alzheimer’s Disease, XanADu patients with elevated baseline pTau-181 protein (at least 6.74pg/mL), representing
34 patients (16 on Xanamem 10mg daily, 18 on placebo), showed a 0.6 mean difference
(effect size) on the CDR-SB scale at 12 weeks between the placebo and treatment arms,
representing a 60% relative reduction in progression. This suggests that Xanamem’s
potential cognitive or disease-slowing effects may be sensitively detected by the
CDR-SB endpoint, which is the primary endpoint in the ongoing XanaMIA Phase IIb trial
in patients with AD as confirmed through elevated baseline pTau-181.
Interim (futility) analysis results expected in early Q1 CY26
The XanaMIA interim analysis is a key catalyst for Actinogen as it will be the first
major clinical readout for Xanamem in AD since the subset analysis from the XanADu
study first reported in Q422. More importantly, the interim readout will provide a
pre-specified futility analysis, which is designed to identify whether the full study readout has a reasonable probability of meeting the primary
efficacy endpoint. The interim analysis will be based on data from all available completed
XanaMIA study participant visits up until that point (including many subjects who
would have completed the full 36-week treatment period).
The DMC consists of independent clinical and statistical experts who are not affiliated
with the day-to-day operations of the study. The DMC will review unblinded study data
for safety and efficacy futility from all available participant visits (in both the
treatment and placebo arms). The DMC will make a recommendation on whether the study
should be permitted to continue as planned, and without disclosing details of its
data review. The DMC may not recommend stopping the study on the basis of positive
efficacy data; in other words, it will only recommend stopping the trial if major
safety concerns are identified, or if its analysis determines the likelihood of the
study meeting the primary efficacy endpoint is near nil (ie if ‘futility’ criteria
are met).
If the investigators determine that the interim data are supportive of the study potentially
meeting the endpoint (ie that the study is not ‘futile’), they will determine that
the study should continue as planned. We believe that if this interim analysis supports
the continuation of the study (thus passing the futility analysis), which we believe
is very probable based on the XanADu subset analysis discussed above, this news will
likely be viewed favourably by investors and market participants.
Actinogen maintains its expectation to report full top-line data from the XanaMIA
Phase IIb/III study in Q4 CY26. The company reports that 35 US and Australian clinical
sites are recruiting patients at full pace. It now expects to complete recruitment
of the 220 planned patients by Q4 CY25 or January 2026.
Open-label XanaMIA-DUR extension announced
Actinogen announced that it is offering all XanaMIA study participants (in both the
treatment and placebo arms) the option to participate in an open-label extension study,
termed XanaMIA-DUR, following their completion of the 36-week blinded portion of the
XanaMIA study. The first patient enrolment into this open-label extension phase is
expected in January 2026.
The XanaMIA-DUR study will follow patients for up to 24 months, and all participants
will receive Xanamem 10mg once daily. The trial will evaluate safety and a limited
number of efficacy endpoints such as the CDR-SB scale.
We view this open-label extension phase as a positive development, as we anticipate
that regulators (eg the US FDA) will review an eventual marketing application more
favourably should supportive longer-term (beyond the 36-week period studied during
the XanaMIA randomised trial) safety data be made available, even if the data arise
from an open-label (non-blinded) extension phase.
Robust market need for new AD treatments
Actinogen held an online forum in May 2025 discussing the scope of current treatment candidates for AD as well as the need for
novel therapeutic mechanisms of action such as the unique approach being employed
by Xanamem, with it being the only clinical-stage candidate to our knowledge targeting
excessive cortisol production in the brain. At the forum, Actinogen explained that
despite initial high expectations for anti-amyloid drug Leqembi’s (lecanemab) market uptake and peak sales following
its approval in 2023, the pace of sales two years after its launch have been lower
than these projections, with Eisai reporting JPY44.3bn (c
US$310m) for the full fiscal year 2024 (1 April 2024 to 31 March 2025).
At the forum, Actinogen CMO Dr Dana Hilt suggested that a key reason is that Leqembi’s
overall effectiveness, as shown in the Clarity AD pivotal study, only reduced a fraction of the overall rate of decline of AD patients in the trial,
leaving much room for improvement for other compounds/drugs, such as Xanamem. In the
Clarity AD study, the mean change from baseline between the lecanemab group and the
placebo group at 18 months was -0.45 (P<0.0001) on the primary endpoint of the CDR-SB
global cognitive and functional scale. However, the overall reduction in the placebo
group was about 1.6 points (vs c 1.2 points for the lecanemab group). According to
Actinogen, the minimally clinically important difference of 1–2 points on the CDR-SB
scale was not achieved. Hence, again, there could be much room for improvement in
the AD landscape with a therapeutic such as Xanamem.
| Exhibit 3: Lecanemab’s effect on CDR-SB scale versus placebo in pivotal trial |
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| Source: Actinogen presentation, May 2025. Note: MCID, Minimally Clinically Important
Difference to placebo. |
Given Xanamem’s dosing convenience (a once-daily oral pill), the favourable safety
profile shown to date for Xanamem across multiple studies involving over 500 patients
in total (including more than 400 patients treated with the drug) and low expected
drug interactions, Actinogen expects that Xanamem can be used both alone and/or in
combination with other AD therapies, such as anti-amyloid drugs or more established
drugs (like cholinesterase inhibitors or NMDA receptor antagonists) in AD. Our model
already assumes that the combination therapy potential helps extend the commercial
opportunity of the drug.
Laying the foundation for the next depression study
While Actinogen’s capital allocation and strategic priority is to fund and complete
its XanaMIA Phase IIb/III study in AD, the company continues to advance the path towards
establishing the next clinical study programme for Xanamem in MDD, which it expects
to serve as one of the two pivotal studies required for registration.
In March 2025, Actinogen held a successful Type C meeting with FDA officials on its MDD programme
for Xanamem. The meeting followed the positive signals reported in Q324 for Xanamem
in treating depression symptoms shown in the Phase IIa XanaCIDD study in MDD. The company reported that it had reached a common understanding with the
FDA in terms of what additional clinical trials, clinical pharmacology and non-clinical
study data are required to potentially file for marketing approval for Xanamem in
MDD in the future. The company plans to use the agreements reached with the FDA in
discussions with potential partners and granting agencies. Actinogen also plans to
have a Type C meeting for the AD programme with the FDA’s neurology division in H2
CY25.
The company does not intend to independently fund or start future Xanamem studies
in depression prior to the conclusion of the XanaMIA study. While Actinogen is seeking
grants or other non-dilutive forms of capital to help fund the next depression study,
our base-case scenario continues to assume that Actinogen will not start its next
clinical study in MDD until CY27 (ie after the conclusion of XanaMIA). We continue
to assume a potential launch in MDD in CY29. While it is possible the company may
obtain non-dilutive funding and/or enter into a licensing agreement for Xanamem before
the conclusion of XanaMIA (which could provide the funding needed to start the next
MDD study), we believe the more likely scenario is that Actinogen would only secure
a material Xanamem licensing transaction (covering AD and other indications such as
MDD) following the conclusion of the XanaMIA study. We expect that the economic benefits
(the potential upfront and milestone payments and royalty rates) are likely to be
much more substantial if a transaction is realised after the release of positive interim
XanaMIA data.
Recap of XanaCIDD’s positive data in depression
As a reminder, while the six-week XanaCIDD study (n=165) assessing 10mg Xanamem once
daily versus placebo did not meet its primary efficacy endpoint of demonstrating a
cognitive improvement over placebo, the top-line data did show separation in terms
of treatment effect in resolving depression symptoms, including a statistically significant
improvement at 10 weeks (four weeks following the end of the six-week blinded treatment
period). In all patients, a trend towards benefit was seen at the six-week end-of-treatment
(EOT) visit in the recognised Montgomery-Åsberg Depression Rating Scale (MADRS) versus
placebo (two-sided p=0.23, not reaching statistical significance). A meaningful and
statistically significant 2.7 point difference in the MADRS score (two-sided p<0.05)
was shown at four weeks after the EOT visit (week 10 of the study).
| Exhibit 4: Improvements on MADRS scale from XanaCIDD study |
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| Source: Company presentation, June 2025. Note: MADRS, Montgomery-Asberg Depression
Rating Scale. |
The 10-week (four-week post EOT) result in terms of MADRS reduction versus placebo
of 2.7 points compares favourably to the effectiveness of existing approved drugs
for MDD. For instance, a meta-analysis of placebo-controlled trials for Trintellix (vortioxetine, Takeda/Lundbeck, with c
US$0.7bn in FY24 sales) found that over a six- to eight-week treatment duration MADRS total
scores reduced on average by 2.27, 3.57 and 4.57 points versus placebo for daily doses
of 5mg, 10mg and 20mg, respectively. Rexulti (brexpiprazole, Otsuka/Lundbeck), approved
as an adjunctive therapy in MDD and with c
US$0.75bn in FY24 sales, was shown in its second MDD pivotal trial to cause an additional 2.0 point reduction in the MADRS score from baseline to six
weeks compared to the addition of placebo.
Subsequent XanaCIDD data reported in August 2024, which include findings using the Patient Global Impression of Severity score in
depression, confirmed that maximal treatment effects on depression on all endpoints
occurred at week 10. The results appear to be consistent with the molecule having
a durable clinical effect in terms of controlling brain cortisol and potentially exerting
anti-depressant activity. Actinogen also reported that Xanamem was well tolerated
with a favourable safety profile in XanaCIDD, consistent with prior studies.
If improvements in addressing depression symptoms are consistently shown in future
trials, Xanamem has the potential to be differentiated from existing approved drug
treatments for depression due to its unique mechanism of action involving the suppression
of cortisol formation in the brain.
Financials
Actinogen’s most recent Quarterly 4C financial update (for the three months ending 31 March 2025, or Q325) showed that R&D spending outflows
in the quarter (predominantly related to the XanaMIA study) were A$2.9m, higher than
the implied quarterly run-rate from the reported A$4.6m in H125 R&D (for the six months
ending 31 December). The company reported a quarterly operating cash burn rate of
A$4.2m in Q325, and ended March 2025 with a gross cash balance of A$18.7m.
In Q225 (Q4 CY24), Actinogen received a A$9.0m Research and Development Tax Incentive
(RDTI) payment from the Australian government (for R&D activities conducted in FY24).
As a result, the company reported positive operating cash flow of A$1.7m for H125.
Excluding the R&D rebate payment, we calculate that the company’s H125 burn rate would
have been c A$7.3m.
R&D advance debt facility boosts flexibility
To further strengthen its runway, the company recently announced that it has entered into a debt facility with Endpoints Capital that is secured by
its upcoming anticipated RDTI payments from the Australian government. Under the Australian
government’s RDTI programme, Actinogen is eligible to receive cash rebates corresponding
to up to 48.5% of its R&D and related costs, and as stated above, the company received
a A$9.0m payment in FY24.
Actinogen received A$3.0m as an initial tranche from the Endpoints funding facility,
which together with its existing funds on hand of A$13.4m, brings its 30 June 2025
gross cash position to c A$16.4m. Actinogen could be entitled to an additional A$2.9m
in Q3 CY25 (Q126) subject to approval by the Australian Taxation Office of the company’s
FY25 Advanced Overseas Finding application, and an additional A$7.9m in relation to the company’s FY26 RDTI. The
company expects to repay these loans as the RDTI cash rebates are received from the
Australian government (we expect the next payment to occur in Q4 CY25). Overall, we
expect the advance R&D facility with Endpoints should strengthen the company’s liquidity
and access to capital into H2 CY26 (FY27).
Cash burn rate expected to stabilise
Excluding the initial A$3.0m tranche, the company’s reported A$13.4m cash position
at end-June implies a Q425 (Q2 CY25) cash burn rate of c A$5.3m, which is above recent
trends. While quarterly financials have not yet been released, we believe that as
the number of subjects enroled in the XanaMIA trial has increased, the associated
ongoing study cost rates for the 36-week study may have also risen (given the that
the total number of subjects being regularly treated and monitored has risen). It
is also possible that the higher quarterly burn rate in Q425 could be due in part
to working capital movements (which will be known once the FY25 results, expected
in August, are released).
Overall, as the XanaMIA study has ramped up and enrolment has surpassed the midpoint
target, we anticipate that Actinogen’s quarterly cash burn rate is likely to stabilise
and remain mostly consistent throughout FY26 and H127, prior to the study’s expected
conclusion (in Q4 CY26 or Q227). Actinogen maintains that it expects its end-June
cash on hand (A$16.4m) to be sufficient to maintain operations to mid-CY26 (the start
of FY27), in line with our projections.
The US dollar has declined modestly versus the Australian dollar since our last published
note in February 2025 (A$0.66/
US$, versus A$0.63/US$ previously) and as we model that much of Actinogen’s R&D costs
will be incurred in US dollars, this would result in a mild downward shift (in Australian
dollar terms) in our overall R&D spending estimates. Below is a summary of adjustments
to our FY25 and FY26 forecasts.
| Exhibit 5: Changes to Actinogen forecasts |
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| Source: Edison Investment Research |
We now estimate that net FY25 and FY26 R&D expenses will be A$12.9m and A$21.2m, respectively,
versus our prior estimates of A$13.5m and A$22.2m. Our FY25 and FY26 operating cash
burn estimates are A$7.1m and A$16.1m, respectively, compared to our prior estimates
of A$8.9m and A$10.0m, respectively. The increased FY26 burn rate is due to an increase
in the expected working capital allocation for the clinical trial programme.
As stated above, we estimate that Actinogen has sufficient funds on hand to maintain
operations into H127 (H2 CY26), consistent with management’s guidance. While the company
has a Type C meeting with the FDA in H2 CY25, we continue to assume that Actinogen
will need to pursue a single additional Phase III study in AD (after XanaMIA) prior
to filing for regulatory approval. We expect that this trial will be significantly
larger (in terms of the number of patients recruited) than XanaMIA and that it will
start in H1 CY27, consistent with management guidance. We continue to assume the company
will start a Phase IIb study in MDD in H1 CY27.
We continue to project that Actinogen will receive R&D research tax credits (which
correspond to up to 48.5% of R&D and related costs incurred in the prior fiscal year)
from the Australian government. We maintain our timing forecasts for a potential launch
in CY29 for Xanamem in both the AD and MDD indications.
We assume that Actinogen’s current funds on hands will be sufficient for the company
to maintain operations into FY27 (H2 CY26). As our base-case scenario does not assume
a commercial out-licensing partnership for Xanamem, our model continues to project
the total projected future funding needed to launch Xanamem in AD and MDD and obtain
recurring operating profitability will be A$285m.
Valuation
Our valuation is based on a rNPV analysis, which includes A$13.4m in net cash at end-June
2025. We apply a discount rate of 12.5% and include Xanamem in the two lead indications.
We continue to use a PoS of 10% for Xanamem to reach the market in the AD indication
and a PoS of 12.5% in the MDD indication. We have rolled forward our estimates by
two quarters and have adjusted our forex estimates to A$0.66/US$ (versus A$0.63/US$
previously) and now obtain a total equity valuation of A$724.6m (versus A$673.8m previously),
or A$0.23 per share (versus A$0.22 per share previously). Our valuation has increased
due to the rolling forward of our estimates, which reduces the discounting effects
of our projected future cash flows from Xanamem sales (starting in CY29, assuming
successful development in the clinical programmes in AD and MDD).
| Exhibit 6: Actinogen rNPV valuation |
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| Source: Edison Investment Research |
As stated above, the most material medium-term catalyst for Actinogen is the interim
analysis (in early CY26) of the Phase IIb/III XanaMIA study, which prospectively enrols
patients with elevated pTau-181. Investors will be looking to see whether these data
confirm the longer-term safety of Xanamem and whether the interim efficacy data are
sufficient to support continuation of the trial to its conclusion. Given the widespread
economic and social costs of AD and the limitations of current approved treatments,
we anticipate positive interim data could hasten material out-licensing or value-realisation
opportunities.
We continue to forecast A$285m in additional financing will be required before FY29
to fund Actinogen’s activities and the development of both the MDD and AD programmes,
after which, provided it receives regulatory approval, Actinogen should be able to
generate sufficient operating revenues to reach recurring profitability. Our model
assumes all financing will be raised through illustrative debt, as per the usual Edison
methodology. If our projected funding need of A$285m is raised through equity issuances
at the prevailing market price of c A$0.025, our effective valuation would decrease
to c A$0.069 per share.
The amount of fund-raising estimated to be needed for Actinogen to independently bring
Xanamem to commercialisation in these indications is larger than the company’s current
market capitalisation. However, we note that the funding intervals may be staggered
over several years, which may alleviate potential challenges associated with raising
such funds. We believe Actinogen will seek non-dilutive funding arrangements and/or
partnership arrangements, which may reduce the overall funding need, but such scenarios
are not included in our forecasts. While our base-case scenario assumes internal Xanamem
development for the AD and MDD programmes, if the company is successful in securing
a licensing deal (or deals) for Xanamem with an established biopharma company (or
companies), our R&D expenditure requirements for Actinogen and, consequently, our
overall funding need projections would likely be significantly reduced.
Given that AD registration-enabling trials are reported to cost more per patient than studies in nearly any other therapeutic area, we expect Actinogen will likely
accelerate efforts to attain partnerships or non-dilutive funding strategies for the
next pivotal AD study (to start in H127) if the interim XanaMIA Phase IIb data are
supportive.
| Exhibit 7: Financial summary |
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| Source: Edison Investment Research |
