Sol-Gel jumps after reporting successful Phase 3 trial

Mori Arkin Photo: Jonathan Bloom

The trial for Sol-Gel's Epsolay for treating rosacea achieved all its endpoints.

Ness Ziona-based Sol-Gel Technologies (Nasdaq: SLGL) saw its share price jump 15.08% in yesterday's session on Nasdaq after it announced that a Phase 3 trial for its Epsolay treatment for rosacea had achieved all the endpoints. Rosacea is a chronic, inflammatory skin condition that most often affects the face.

Epsolay is the first in a pipeline of dermatologic product candidates in development using Sol-Gel’s proprietary microencapsulation technology. This platform was designed to enable drug substances to be entrapped in porous silica microcapsules in order to address the limitations of topical drug delivery by stabilizing active drug ingredients, extending drug delivery time and reducing potential irritation caused by direct application to the skin.

In the fourth quarter of 2019, top-line Phase 3 results are expected for TWIN, the company’s investigational fixed-dose combination of microencapsulated benzoyl peroxide and microencapsulated tretinoin being studied for acne vulgaris.

“While we expected to see strong efficacy and tolerability with Epsolay, the rapid efficacy was a standout in our Phase 3 studies,” said Sol-Gel CEO Dr. Alon Seri-Levy, “It’s very difficult for patients of any dermatological disease, let alone rosacea, to wait months for a positive clinical result. That a quarter of Epsolay patients in both trials reached their treatment goals within a month, when the efficacy of existing topical products can be quite slow, is clinically meaningful and illustrates a clear unmet need within a rapidly growing marketplace.”

Sol-Gel has already made a mini-exit by selling its sun protection products for $10 million to Merck KGaA in order to focus on pharmaceuticals. It later got into financial difficulties and was bought by Mori Arkin, who floated it on Nasdaq in February 2018. Since then, the company's share price has fallen 14%.

Rosacea and acne are also the two leading indicators for Israeli company Foamix Pharmaceuticals (Nasdaq: FOMX), which is traded on Nasdaq at a market cap of $122 million. A comparison of the two companies' twelve week trial results shows a slight advantage to Foamix. Sol-Gel, however, reported substantial improvement after only two weeks. It looks as though the two companies will be competing head-to-head.

Both of them collaborate with other companies, and in fact both have cooperation agreements with Perrigo. In the first quarter of 2019, Sol-Gel posted revenue of $6.3 million from Perrigo, which used Sol-Gel's technology to develop an improved generic version of Zovirax for treating herpes. Sol-Gel's research expense was $10.8 million, due to the fact that it was running four clinical trials simultaneously, and at the end of the quarter it had $54 million cash, which it says will last it until the end of 2020.

Published by Globes, Israel business news - en.globes.co.il - on July 9, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Mori Arkin Photo: Jonathan Bloom
Mori Arkin Photo: Jonathan Bloom
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