Arbutus Biopharma Gets Green Light for Phase 1a/1b Clinical Trial

Arbutus Biopharma (NASDAQ:ABUS) has been given the okay to start a Phase 1a/1b clinical trial for one of its hepatitis B virus (HBV) assets, AB-729, the company said on Thursday (June 20).

While no date has been given, Dr. Gaston Picchio, chief development officer at Arbutus Biopharma, said that it will “initiate shortly.”

According to the company, AB-729 is projected to be given once a month and aims to target hepatocytes in conjunction with Arbutus Biopharma’s conjugated N-acetylgalactosamine delivery technology. Once the trial begins, AB-729 will be given as an injection under the skin to patients with chronic HBV. AB-729 will also be used in combination with the company’s AB-506 capsid inhibitor.

“The combination of AB-729 and AB-506 … has the potential to result in more profound inhibition of HBV replication in conjunction with a reduction in (hepatitis B surface antigen) HBsAg levels, thus enabling a reawakening of the patient’s immune system,” Picchio said.

AB-506 intends to reduce HBV replication, and is currently undergoing clinical development in a Phase 1a/1b study. The company estimates that it will have topline data from this study in July.

According to the World Health Organization, roughly 257 million people worldwide live with HBV. It is an infection that attacks the liver, and can occur in an acute or chronic form. The organization’s most recent statistics show that there were 887,000 HBV-related deaths in 2015 alone, mostly due to cirrhosis and hepatocellular carcinoma.

In terms of the overarching hepatitis therapeutics market, Grand View Research estimates that the industry was worth US$16.6 billion in 2016 and projects that it will grow at a compound annual growth rate of 2.7 percent between 2018 and 2025. A Global Data report specific to HBV projects that the HBV market alone will be worth US$3 billion by 2024.

“Low diagnosis rates for hepatitis B are self-perpetuating, as they lead to lack of disease awareness and therefore a dearth of people seeking medical advice or appropriate drugs for their condition. In addition, the negative social stigma surrounding hepatitis means that many people are reluctant to get tested,” the report explains.

In short, the HBV sector is projected for exponential growth; with 298 clinical studies currently underway for HBV, investors may want to look at companies advancing these products in the coming years.

Following Thursday’s announcement, Arbutus Biopharma soared over 37 percent to close the trading session at US$2.36. Despite this increase, the company has tumbled over 54 percent year-to-date.

TipRanks’ analyst consensus currently pegs Arbutus Biopharma as a “moderate buy” based off two analyst ratings. The company has an average price target of US$6, with a high estimate of US$7 and a low of US$5 over a 12 month period.

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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any of the companies mentioned in this article.